ntl to present new business plan today

The Reuters news agency has reported that beleaguered cable giant ntl is to meet with its bankers later today, in order to present a revised business plan for this year, and outline its plans for a bond restructuring on its £4.1bn of outstanding debt.

While there has been no word from ntl over the meeting, it is clear that the company needs to take decisive action now. Persisting concerns over its inability to manage its huge debt load, estimated to be in the region of £12bn, are continuing to drag the share price lower. During trade in New York today, the company's stock hit an all-time low of 46 cents, although it made a measly recovery of 3 cents by the closing bell. The previous yearly-low had been $0.51. The company, once worth approximately £7.6bn, is now worth around £90.2m, adding to its woes.

Concerns are also persisting over the company's failure to sell off its network of transmitter towers in the UK. These towers transmit the signals for ITV, Channel 4 and Channel 5, as well as Independent Local Radio (ILR). ntl had hoped toget as much as £1bn for the towers, but potential buyers such as ntl stakeholder France Telecom have shown relutance to pay even half of this price.

Debt is however the company's main concern at present. A restructuring, to be led by international investment house Credit Suisse First Boston, is expected to be a debt-for-equity swap that will have no effect on jittery lenders that have already lost confidence in ntl's ability to pay off its debts.

The two secured loans that ntl have are now the focus of bankers; and while many are pleased at the announcement of a new business plan, those who are more exposed to ntl's European operations including Cablecom and E-Kabel, are more worried. One banker is quoted as saying:

"The CWC loan is fairly tight and we're comfortable where we stand with the new business plan, but Cablecom is a different situation and we are looking for news on this and NTL's other continental assets."

Confidence in the CWC loan has grown, particularly in the United States where some investors are convinced of ntl's long-term prospects - the price of the debt has been cranked up to 87p, an increase of around 10p in the pound. Whether or not this confidence will be maintained is another matter, with investors, analysts and consumers wondering quite what will become of Britain's largest cable operator.

Portions of this report are ©2002 Reuters News Service.