France added to BBC bid list

Click to follow
France Telecom, the French phone giant, last night emerged as one of four serious bidders for BBC Transmission, the arm of the public service broadcaster that is to be privatised by the end of the year.

The French offer is believed to be lower than the bid from NTL, the transmission company owned by International CableTel that supplies services for ITV, Channel 4 and Channel 5, the soon-to-be-launched fifth terrestrial service. An NTL spokesman declined to comment.

Also bidding, it is understood, is a management buy-out group, possibly with the backing of Mercury Asset Management. Sources suggested last night there were as many as five companies on a shortlist for the sale, following several weeks of evaluation by the BBC and Lehman Brothers, which is handling the negotiations. The BBC had no comment yesterday, except to confirm it intended to complete the sale by the end of the year.

The BBC's own advisers have put a price-tag of about pounds 180m on the transmission service, although NTL and France Telecom are each believed to have bid more than pounds 200m. The sale is complicated by the fact that not all services managed by the transmission arm are being sold. It is understood that telecoms systems linking London and the North, for instance, will not be part of the sale.

Included with the assets being sold will be 500 transmitters in the UK and all transmission and receiving equipment at the sites and the Warwick headquarters.

The sale is being handled in two stages, the first involving the domestic television and radio services and the second incorporating equipment used for the World Service, which is financed by the Foreign and Commonwealth Office.

NTL has long been touted as the most likely bidder for BBC Transmission, as it already shares several sites and has developed an aggressive development plan to prepare for the launch of digital terrestrial television, scheduled for 1998.

NTL was bought by International CableTel earlier this year for pounds 235m from a group backed by MAM, which had successfully bid for the company when it was privatised in 1991. Since then, the company has applied for a national telecoms licence.

NTL would almost certainly face regulatory hurdles as a buyer of BBC Transmission.