Providence leads private equity bid for NTL

NTL, the cable television and broadband company, is in talks with a consortium of private equity companies that could result in Europe's largest-ever private equity takeover.

Sources close to the situation said the private equity companies involved include Providence Equity Partners, the Blackstone Group, Cinven and Kohlberg Kravis Roberts. Providence is said to be leading the bid. Talks between NTL and the private equity companies began at the start of August but no price has yet been agreed.

NTL declined to comment on reports the bid could be worth £10bn. That price would be £1bn higher than a private equity approach last year that was rejected out of hand, shortly after NTL had agreed to purchase its smaller cable television rival Telewest. Earlier this year, it completed the acquisition of Virgin Mobile, which involves a licensing deal with Sir Richard Branson to rebrand the NTL business as Virgin, providing NTL with a mobile arm and meaning it can offer customers broadband and television as well as fixed and mobile telecoms services as one package.

After the acquisition, Virgin Group became NTL's largest shareholder with a 10.5 per cent stake. However, the company has not been informed about the private equity approach. Will Whitehorn, a Virgin Group spokesman, said: "There has been no approach to us, nothing that we are aware of." Mr Whitehorn said Virgin remains an "enthusiastic shareholder" in NTL.

NTL was the subject of a private equity approach worth about £9bn last year. The consortium at that stage reportedly included Blackstone and Cinven, but also BC Partners and Permira Advisers. Some NTL shareholders are believed to be unhappy that the board rejected the $32-a-share approach without consulting them. The shares currently trade at about $25 (£13).