NTL, which runs a network of cable television franchises around the country yesterday paid Douglas Hall, the disgraced Newcastle director, pounds 10m for a 6 per cent stake in the club and took out an option to buy the rest of the Hall family's shareholding and take full control of the club.
The proposed deal values the club at almost pounds 160m, and would see Mr Hall bank a windfall in excess of pounds 90m. His drinking partner and fellow shareholder, Freddie Shepherd, would pocket more than pounds 13m.
If it takes control, of Newcastle, NTL has pledged to pump pounds 15m into the football club over five years in order to improve its ailing youth training scheme. It will also support Newcastle's plans to enlarge its St James' Park ground.
Barclay Knapp, the company's American chief executive, said it would respect the supporters. "The fans are our customers and if you know anything about NTL we're very customer-focused," he said.
"We believe strongly that the future success of football will continue to be developed on the enthusiasm and active support of fans."
He added that he thought Newcastle were one of the three or four best teams in the country and could compete with the best in Europe. However, Mr Knapp, who lives in New York, admitted he had never been to a Newcastle match and preferred to follow the New York Giants American football team.
Freddie Fletcher, Newcastle's chief executive, welcomed the deal as "an important step towards securing the long term success of Newcastle United".
NTL's takeover is dependent on the Monopolies and Mergers Commission's investigation into the pounds 625m takeover of Manchester United by British Sky Broadcasting, the satellite broadcaster. The MMC, which is examining whether the bid is against the public interest, is due to deliver its report by 12 March.
If the MMC clears the BSkyB-Manchester Uniteddeal, NTL will be able to exercise an option to buy the remaining 50.8 per cent of Newcastle owned by Cameron Hall developments, the Hall family firm, for 111.7p per share.
Under Stock Exchange rules, NTL would then have to offer the same terms to the club's remaining shareholders. Fans paid 135p per share when the club was listed on the Stock Exchange two years ago. Until then, NTL insists it will not be involved in running the club.
A takeover would be a remarkable turnaround for Hall and Shepherd, who were forced to resign in shame in March after they were exposed insulting Newcastle's fans.
Last week, the duo returned to Newcastle United's board, prompting the resignation of three other directors and the club's stockbroker.
They have been in talks with NTL for two months but did not have to make the discussions public because they did not sit on the company's board.
Other media groups have been exploring buying a football club. Carlton and United News, the television companies, have both been in talks with Arsenal while Time Warner0, the US giant, is also believed to be in the hunt for a British club.
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