Five questions answered on the sale of Virgin Media to Liberty Global

Birth of the world’s biggest broadband company.

Today it has been announced that Liberty Global will buy Richard Branson’s Virgin Media. We answer five questions on the two companies impending merger which will create the world’s biggest broadband company.

What is Liberty Global?

Liberty Global is an international media company and one of the largest broadband providers outside the US, operating in 13 countries, including Germany and Belgium.

John Malone is the company’s chairman who has had a long standing rivalry with Rupert Murdoch, who he clashed with in 2001 when News Corp and Liberty Global vied for control of DirecTV Group, the largest US satellite TV broadcaster.

How much has Liberty Global agreed to buy Virgin Media for?

In a cash and stock deal the company will pay $23.3bn (£15bn) to the UK Virgin Media company.

Shareholders in Virgin Media will recieve $47.87 a share, with $17.50 in cash and the rest in Liberty Global shares.

As part of that deal Sir Richard Branson retains a 3 per cent stake in the company, which has a 30-year brand licensing agreement with his Virgin Group.

The merger is subject to shareholder and regulatory approvals.

How does the deal fit into the wider context of the broadband/ pay-TV industry?

The merger will create the world’s biggest broadband company, with 25 million customers in 14 countries, and puts Malone in direct rivalry with Rupert Murdoch, whose media empire owns 39 per cent of BSkyB. The merged company will also be the second biggest pay-TV business after BSkyB in the UK.

Virgin Media was originally created from the merger of NTL and Telewest, and Sir Richard Branson's Virgin Mobile in 2006.

It is thought that Liberty Global will keep the Virgin Media branding.

What has Liberty Global said about its merger with Virgin Media?

Mike Fries, President and CEO of Liberty Global, in a press release statement said: “Adding Virgin Media to our large and growing European operations is a natural extension of the value creation strategy we've been successfully using for over seven years.

“After the deal, roughly 80 per cent of Liberty Global's revenue will come from just five attractive and strong countries - the UK, Germany, Belgium, Switzerland and the Netherlands.

"Like all of our strategic acquisitions we expect this combination to yield meaningful operating and capex synergies of approximately $180 million per year upon full integration.”

What has Virgin Media representatives said?

Virgin Media CEO Neil Berkett said: “Over the past six years, Virgin Media has transformed the digital experience of millions of customers, catalyzed a deep-rooted change in the UK’s digital landscape and delivered impressive growth and returns for our shareholders. I’m confident that this deal will help us to build on this legacy.

“Virgin Media and Liberty Global have a shared ambition, focus on operational excellence and commitment to driving shareholder value. The combined company will be able to grow faster and deliver enhanced returns by capitalizing on the exciting opportunities that the digital revolution presents, both in the UK and across Europe.”

Photograph: Getty Images

Heidi Vella is a features writer for Nridigital.com

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“We can’t do this again”: Labour conference reactions to Jeremy Corbyn’s second victory

Overjoyed members, determined allies and concerned MPs are divided on how to unite.

“I tell you what, I want to know who those 193,229 people are.” This was the reaction of one Labour member a few rows from the front of the stage, following the announcement of Jeremy Corbyn’s victory at the Labour party conference. She was referring to support received by his defeated contender, Owen Smith, who won 38.2 per cent of the vote (to Corbyn’s 61.8 per cent).

But it’s this focus on the leader’s critics – so vehement among many (and there are a lot of them) of his fans – that many politicians, of either side, who were watching his victory speech in the conference hall want to put an end to.

“It’s about unity and bringing us all together – I think that’s what has to come out of this,” says shadow cabinet member and MP for Edmonton Kate Osamor. “It shouldn’t be about the figures, and how many votes, and his percentage, because that will just cause more animosity.”

Osamor, who is supportive of Corbyn’s leadership, is not alone in urging her colleagues who resigned from the shadow cabinet to “remember the door is never shut”.

Shadow minister and member of Labour’s National Executive Committee (NEC) Jon Ashworth – not a Corbyn loyalist, but focusing on making the shadow cabinet work together – shares the sentiment.

Standing pensively in front of the now-empty stage, he tells me he backs shadow cabinet elections (though not for every post) – a change to party rules that has not yet been decided by the NEC. “[It] would be a good way of bringing people back,” he says. “I’ve been involved in discussions behind the scenes this week and I hope we can get some resolution on the issue.”

He adds: “Jeremy’s won, he has to recognise a number of people didn’t vote for him, so we’ve got to unite.”

The former Foreign Secretary Margaret Beckett, another MP on the NEC, is sitting in the audience, looking over some documents. She warns that “it’s impossible to tell” whether those who resigned from Corbyn’s shadow cabinet would be willing to return, and is concerned about talent being wasted.

“We have a lot of excellent people in the party; there are new people now in the shadow cabinet who have had a chance to show their mettle but you need experience as well as ability,” she says.

Beckett, who has urged Corbyn to stand down in the past, hopes “everybody’s listening” to his call for unity, but questions how that will be achieved.

“How much bad blood there is among people who were told that there was plotting [against Corbyn], it’s impossible to tell, but obviously that doesn’t make for a very good atmosphere,” she says. “But Jeremy says we’ll wipe the slate clean, so let’s hope everybody will wipe the slate clean.”

It doesn’t look that way yet. Socialist veteran Dennis Skinner is prowling around the party conference space outside the hall, barking with glee about Corbyn’s defeated foes. “He’s trebled the membership,” he cries. “A figure that Blair, Brown and Prescott could only dream about. On average there’s more than a thousand of them [new members] in every constituency. Right-wing members of the parliamentary Labour party need to get on board!”

A call that may go unheeded, with fervent Corbyn allies and critics alike already straying from the unity message. The shadow justice secretary Richard Burgon is reminding the PLP that, “Jeremy’s won by a bigger margin this time”, and telling journalists after the speech that he is “relaxed” about how the shadow cabinet is recruited (not a rallying cry for shadow cabinet elections).

“If Jeremy wants to hold out an olive branch to the PLP, work with MPs more closely, he has to look very seriously at that [shadow cabinet elections]; it’s gone to the NEC but no decision has been made,” says Louise Ellman, the Liverpool MP and transport committee chair who has been critical of Corbyn’s leadership. “That might not be the only way. I think he has to find a way of working with MPs, because we’re all elected by millions of people – the general public – and he seems to dismiss that.”

“If he sees it [his victory] as an endorsement of how he’s been operating up until now, the problems which led to the election being called will remain,” Ellman warns. “If we’re going to be a credible party of government, we’ve got to reach out to the general electorate. He didn’t say anything about that in his speech, but I hope that perhaps now he might feel more confident to be able to change direction.”

Corbyn may have called for cooperation, but his increased mandate (up from his last stonking victory with 59.5 per cent of the vote) is the starkest illustration yet of the gulf between his popularity in Parliament and among members.

The fact that one attempt at a ceasefire in the party’s civil war – by allowing MPs to vote for some shadow cabinet posts – is in contention suggests this gulf is in danger of increasing.

And then where could the party be this time next year? As Osamor warns: “We should not be looking at our differences, because when we do that, we end up thinking it’s a good thing to spend our summer having another contest. And we can’t. We can’t do this again.”

Anoosh Chakelian is deputy web editor at the New Statesman.