NTL plans cost-cutting programme
to meet £950m profits target
LONDON - NTL chief executive Barclay Knapp is said to be scrambling to find another way of raising the £1.5bn which the sale of its broadcast transmission business had been expected to fetch.
Knapp expected the transmission business -- which includes 3,000 broadcast masts and provides services to ITV and mobile companies -- would be sold by the year-end, but reports emerged yesterday that this time frame is unlikely to be met.
Knapp is said to be drawing up a plan to ensure the company does not miss the target for underlying earnings before interest, tax, depreciation and amortisation in 2002 of £950m that it agreed with bankers, even though most of that figure will be wiped out by interest payments of £840m.
France Telecom, which owns 25% of NTL, was reported to be interested, along with investment bank West LB, in the transmission business. However, neither appears to want to pay the asking price.
Knapp is said to be reluctant to sell the business for less than £1.5bn because it generates a steady income for the group.
The alternative, however, is to cut capital expenditure, which could cause sales to slow. NTL has already halved investment in its network from £1.9bn last year to a forecast £925m in 2002 and £900m in 2003.
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