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Branson shareholding in Virgin Media down to 6.5%, media group relaunches flagship channel
By CMU Editorial | Published on Tuesday 19 May 2009
Richard Branson’s Virgin Group have cut their already quite small shareholding in the mobile/cable TV company that uses their brand by a third, meaning Branson’s company now has just a 6.5% stake in Virgin Media.
Branson sold just under 4% of his stock in Virgin Media to investment bank Credit Suisse in order to free up funds to fund Virgin Mobile’s expansion into the Indian market. It’s not a new deal by any means, it was done in 2007, but has only just come to light as the result of regulatory filings made by the Virgin company in the US. The newer element to story is that as part of the deal Branson had the right to buy the shares back after two years, an option Virgin Group have not taken up.
The Virgin Group denies that the sale of the Virgin Media shares, and subsequent decision not to buy them back, is a sign that Branson or his company are losing interest in the UK mobile and media enterprise, which was created by the merger of cable companies NTL and Telewest with Branson’s Virgin Mobile business in 2006.
A Virgin Group spokesman is quoted thus: “Our brand is in Virgin Media and we are committed to it, we have board seats and a lot of support for management there. This is just about asset allocation, we have fifty big businesses and we are investing in new ones all the time. This was done two years ago. Just look at the economics of it: it was done at a time when share prices were high and we had a number of other ventures that we wanted to invest in. It was a bit of financial engineering to get some capital and it just makes sense now to see it through”.
With 6.5% of Virgin Media, Branson’s company is the fourth largest shareholder in the media/mobile company, behind three investment houses. The cable company has a 30 year licensing deal to use the Virgin brand in the UK cable, mobile and internet markets, and the firm has certainly benefited from operating under the Virgin name – with neither NTL nor Telewest loved by anyone really – so Branson’s share deals shouldn’t affect the public face of the media firm.
Talking of the public face of Virgin Media, one of the media firm’s most public uses of Branson’s brand, the Virgin1 TV channel, is to relaunch next month with, and I quote, a “dynamic new logo, eye-catching idents and creative online elements”. So, that will be nice. The rebrand comes amid efforts to “reinvigorate” the channel, which is available via Freeview, Sky and the Virgin cable network, and which has never really lived up to its glitzy launch in 2007, consisting, as it doaes, of a very small number of flagship US shows, some terrible home-grown programmes, and a load of very old school US and UK repeats.
Confirming the revamp, the channel’s Director Of Programmes, Daniela Neuman, told reporters: “Virgin1 is one of the fastest growing channels on TV with audience share increasing by 18% year-on-year and it has just celebrated its best month ever. This rebrand, combined with our 24 hours move to Freeview, is just the start of a really exciting time for the channel with it truly finding its voice and personality”.
