Branson stands behind Virgin
EmptyBillionaire entrepreneur Richard Branson said Thursday that he would not expect to sell his stake in cable giant Virgin Media in the event of a private-equity buyout, contending that he sees the new channel Virgin1 surpassing rival Sky One's ratings within "three to four years."
At a party he hosted to celebrate the upcoming launch of Virgin1, Branson said the Virgin brand would remain with the cable operator for the long term.
"I'm speaking now as the largest shareholder in Virgin Media, not as a member of the board," he said. "I think it's extremely unlikely the Virgin brand would ever be withdrawn from Virgin Media," Branson said.
He added: "We have never said that we'd be selling our shares. … I think if anybody wanted to buy Virgin Media, it would be because it's got the brand. They wouldn't spend billions of pounds on it and then rebrand."
Asked to clarify that he would not sell his stake in the company in the event that a bid approach were repeated like the one made by private-equity firm Carlyle Group in the summer, he said: "I'm not sure that I am allowed to say that. I chose my words pretty carefully in what I said before."
A bid from Carlyle, thought to value the group at about $23 billion including a provision for $12 billion in debt, was withdrawn in July amid the credit squeeze that has affected debt financing provisions.
Virgin Media opted to launch its own entertainment channel after negotiations with British Sky Broadcasting to carry a package, including Sky One and Sky News, ended in acrimony. About 40,000 Virgin customers canceled their subscriptions in the quarter that Sky's channels — home to "Lost" and "24" — were dropped from Virgin Media homes.
Branson said that Virgin1, which boasts "The Sarah Connor Chronicles" and "The Riches," eventually would beat Sky One's ratings.
"We are hopeful that in years to come we will have a greater number of viewers than Sky One, in about three or four years. We are not spending the same amount of money as they are, but we would like to get the same audiences. Sky One does not get a very big view."
Virgin1 will launch in 19 million cable, satellite and Freeview U.K. homes Monday. BSkyB's Sky One remains exclusive to Sky's 8 million satellite homes.