ntl told to seek Chapter 11 protection

spanner_head

Hi,

Just found this article while reading digitialspy.co.uk.
Don't really know how this affects Ireland. But it shows that NTL are a little bit short on the ould cashish.

Took the story from the following link.

http://www.digitalspy.co.uk/displayarticle.php?id=4448

BREAKING NEWS: ntl told to seek Chapter 11 protection
Posted on Monday, 17th December 2001 at 18:50 GMT by James Welsh
Updated: 18:53, 18:55, 19:18, 19:23

ntl, Britain's largest cable operator, has today been urged by investors to seek Chapter 11 bankruptcy protection as its financial situation continues to worsen as the end of 2001 approaches.

The company's shares have shed nearly 97% of their value during this year alone. Moody's Investors Service has already cut the cable company's bonds to 'junk' status, four levels above 'default'. Since that date (November 26), the stock has plummeted 78%.

Investment houses today urged the New York-based company to immediately seek Chapter 11 bankcruptcy protection, so as to avoid an even worse situation further down the line.

Roman Gaiser from F&C Management in London told Bloomberg:

"Chapter 11 would save the interest. It would also help them to keep their business going, and that would be one of their major concerns - not to disrupt operations and lose more customers."

Christine Johnson from Investec Asset Management agreed:

"It's not a functioning business. It has run out of choices and it's now recognized as being a very serious situation."

More extreme options are already being discussed, with one analyst at Barclays Capital Group telling Bloomberg: "The best outcome for NTL Communications Corp. bondholders may be from the auction of the company by its banks."

A bleak outlook is also predicted, with many analysts not expecting a bail-out package anytime soon, even from France Telecom which has an 18% stake in the company. Its plans to dispose of non-core assets such as transmission towers in the UK and Australia are also thought to be failing, with potential buyers unwilling to stump up the asking price of £1bn. Investors are urging the company not to sell the assets at a reduced price, but to keep them to maintain the revenue stream.

ntl's board is meeting today in New York City, although no details were released by the ntl press office of what was being discussed. A statement from the company is expected at the end of the year regarding the sale of its transmitter towers; whether or not this will include a reassurance for investors, staff and customers, is unknown. ntl has previously released statements from CEO Barclay Knapp to reassure investors about ntl's financial situation and its ability to maintain cashflow through 2003; but even these were called into question when international brokers Credit Suisse First Boston warned of an impending funding crisis earlier this month.

Shares in the company are currently trading down in New York, with the stock off 12.68% at $0.62 as of 2pm ET today.

Boston

hmm, its not like things can get any worse, they cant

ntl make plenty of money here, because they didnt borrow huge amounts to bankroll upgrading