Tiscali In Survival Fight As BSkyB Sale Fails
Tiscali, the UK’s fifth largest broadband provider with over 1.8 million broadband customers is facing a fight for survival following the breakdown of its sale to broadcaster and triple play operator BSkyB.
The company, which operates in the UK and Italy is now asking banks to freeze its loan interest and capital repayments whilst it focuses on rebuilding its infrastructure. Shares in the company have been suspended following an extraordinary 40% drop in just one day.
The company’s main debt holder, JP Morgan, is now looking at all the options available with administration likely.
The company has debt of roughly £508 million, with deadlines for their next repayments of 11 million Euros being today, March 11th and Friday March 13th.
The proposed sale of Tiscali’s UK assets to BSkyB broke down because BSkyB’s offer, influenced by the current economic slow down, was far short of the £500-£600 million that Tiscali was asking for.
It now looks like the company will either have to cut its losses and sell well below its current asking price, or consider going into administration.
750 people are employed by Tiscali within the UK.