Virgin Media tender offer for 9½% notes oversubscribed by early date

By Susanna Moon

Chicago, March 13 - Virgin Media Inc. subsidiary Virgin Media Finance plc received tenders for $852,392,000, or 63%, of its $1.35 billion dollar-denominated 9½% senior notes due 2016 by the early tender deadline of 5 p.m. ET on March 12.

The company will purchase $500 million of the notes on a prorated basis as the amount tendered exceeds the offer cap, according to a company news release.

As previously reported, the company is offering $1,150, including an early tender premium of $30, per $1,000 principal amount of notes tendered by the early tender deadline.

The company also will pay accrued interest up to but excluding the settlement date.

The tender offer is set to run until at 11:59 p.m. ET on March 26. It began on Feb. 28.

Holders may no longer withdraw tendered notes, and they will not receive the consent premium for notes tendered after the early deadline.

Virgin Media is not making an offer for any of its euro-denominated 9½% senior notes due 2016.

Holders cannot tender all of their notes; they must continue to hold at least $100,000 of the notes once the offer is completed.

The company expects to use cash on hand, drawings under its revolving credit facility and/or funds raised in the debt or loan markets to fund the purchase of the notes.

Virgin Media issued $500 million principal amount of 5¼% senior notes due 2022. The proceeds will be used to fund the offer or to repurchase, redeem or repay any other debt.

The company plans to cancel and retire all of the notes purchased in the tender offer.

The tender offer is part of Virgin Media's £225 million second-phase capital return program announced in July 2011. Virgin Media said the purpose of the tender offer is to allow it to lower its interest cost and "further enhance its capital structure." The ongoing share buyback program, of which £453 million was outstanding at the start of 2012, is still in place and unaffected.

Deutsche Bank Securities Inc. (212 250-7527 or 855 287-1922) and Goldman Sachs & Co. (212 357-4692 or 800 828-3182) are the dealer managers for the tender offer. Lucid Issuer Services Ltd. (virginmedia@lucid-is.com) is the information and tender agent.

New York-based Virgin Media provides television, broadband, fixed-line telephone and mobile telephone services in the United Kingdom.

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