Virgin Media O2 tests waters with £3bn opening offer for TalkTalk
An indicative offer valuing Salford-based TalkTalk at about £3bn including debt has been tabled by Virgin Media O2, the mobile telecoms and pay-TV group.
Virgin Media O2 has tabled an offer to buy TalkTalk that would value one of Britain’s biggest broadband providers at about £3bn.
Sky News has learnt the mobile phone giant, which is jointly owned by Telefonica and Liberty Global, submitted an indicative bid for Salford-based TalkTalk in recent weeks.
Discussions between the two sides are at an early stage and are being held on a non-exclusive basis, City sources said on Friday.
The development comes three months after it emerged that TalkTalk had received a number of tentative approaches from industry rivals including Vodafone and Sky, the immediate parent of Sky News.
Sir Charles Dunstone, TalkTalk's founder and chairman, and Toscafund, which helped take the company private in late 2020, are understood to believe that the company is now worth at least £3bn.
Lazard, the investment bank is advising TalkTalk on interest from suitors such as Virgin Media O2.
Acquiring TalkTalk, whose website says it has 4.2m customers in total and 2.4m fibre connections across the UK, would be a logical move for VMO2 given the scale of the expected synergies.
A formal offer from the company would also increase the pressure on Nick Read, Vodafone's chief executive, to launch a counterbid.
Any strategic deal involving TalkTalk would represent the latest consolidation move in a market where industry executives have consistently referred to the need to find savings to invest in upgrading Britain's digital infrastructure.
Openreach, the infrastructure arm of BT Group, and CityFibre Holdings have both accelerated plans to roll out full-fibre connections across Britain, with a multitude of smaller players also emerging in recent years in an attempt to capture a slice of the market.
TalkTalk also provides a pay-TV service which includes content from Sky and BT Sport-branded channels.
Founded by Sir Charles in 2004 when it was part of the Carphone Warehouse - from which it was subsequently demerged - TalkTalk delisted from the stock market about 18 months ago.
The deal to take it private valued it at about £1.8bn including debt.
VM02 and TalkTalk declined to comment on Friday.
Sky News has learnt the mobile phone giant, which is jointly owned by Telefonica and Liberty Global, submitted an indicative bid for Salford-based TalkTalk in recent weeks.
Discussions between the two sides are at an early stage and are being held on a non-exclusive basis, City sources said on Friday.
The development comes three months after it emerged that TalkTalk had received a number of tentative approaches from industry rivals including Vodafone and Sky, the immediate parent of Sky News.
Sir Charles Dunstone, TalkTalk's founder and chairman, and Toscafund, which helped take the company private in late 2020, are understood to believe that the company is now worth at least £3bn.
Lazard, the investment bank is advising TalkTalk on interest from suitors such as Virgin Media O2.
Acquiring TalkTalk, whose website says it has 4.2m customers in total and 2.4m fibre connections across the UK, would be a logical move for VMO2 given the scale of the expected synergies.
A formal offer from the company would also increase the pressure on Nick Read, Vodafone's chief executive, to launch a counterbid.
Any strategic deal involving TalkTalk would represent the latest consolidation move in a market where industry executives have consistently referred to the need to find savings to invest in upgrading Britain's digital infrastructure.
Openreach, the infrastructure arm of BT Group, and CityFibre Holdings have both accelerated plans to roll out full-fibre connections across Britain, with a multitude of smaller players also emerging in recent years in an attempt to capture a slice of the market.
TalkTalk also provides a pay-TV service which includes content from Sky and BT Sport-branded channels.
Founded by Sir Charles in 2004 when it was part of the Carphone Warehouse - from which it was subsequently demerged - TalkTalk delisted from the stock market about 18 months ago.
The deal to take it private valued it at about £1.8bn including debt.
VM02 and TalkTalk declined to comment on Friday.