Virgin Mobile 'unanimously rejects' NTL offer

Branson says, 'another £100m and we've got a deal'

Update Virgin Mobile has "unanimously rejected" an £817m offer by UK cableco NTL insisting it's just not enough.

On Monday both NTL and Virgin Mobile confirmed they were holding talks that could lead to the creation of a mega media business offering punters a four-play service of TV, fixed-line phone, broadband and mobile under the Virgin brand.

But in a statement Virgin Mobile - which is 72 per cent owned by Sir Richard Branson's Virgin Group - turned down the offer claiming that it "undervalues Virgin Mobile".

The mobile phone company said: "The board of Virgin Mobile has today unanimously rejected the potential offer, which was announced by NTL on 5 December 2005.

"Mindful of its duty to maximise value for all shareholders, in reaching this decision the board has carefully considered the potential offer and consulted with Virgin Mobile's major independent shareholders. The Board has concluded that the potential offer materially undervalues Virgin Mobile."

Despite today's slap in the face analysts are not surprised by Virgin Mobile's stand and would not be surprised to see a revised offer to be made for the business.

A spokeswoman for NTL - which is in the process of merging with UK cableco Telewest - declined to comment.

Update

Richard Branson later told Radio 5 Live that it was the group's "independent directors" that would most like to see more cash. According to reports, he seem to suggest that another £25m would swing it for them. This would gross up to roughly a £100m rise in the overall bid price, valuing the firm at around £910m.®