Untangling the mess; NTL.(The prospects for British cable companies are not as bad as they look)(Brief Article)

Economist (US), The, February, 2002

The prospects for British cable companies are not as bad as they look

BRITAIN'S largest cable operator, NTL, has huge debts, its shares have slumped and it is steadily running out of cash. The root of the problem is NTL's [pound]12-billion debt which its boss, Barclay Knapp, ran up while building the firm's cable network and acquiring smaller rival operators at what now look like vastly inflated prices. Interest payments exceed [pound]3m a day, and the company has enough money in the bank to keep going only for a few more months.

But the trouble is a short-term lack of cash, rather than a deeper strategic problem. Having spent so much building its network, NTL now has no money left to exploit it. The firm has tried to muddle through by cutting jobs,...

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