NTL, the US company which has bought Cablelink, is now in negotiations to purchase CMI, another cable company. If the talks are successful, then NTL will add CMI's 65,000 subscribers to the 360,000 served by Cablelink, thus increasing its dominance of the Irish cable market.
CMI's subscriber base is concentrated in a ring around Dublin in places such as Malahide, Swords and North Kildare. It also services a number of larger towns such as Wicklow and Mullingar.
Its attraction to NTL would be that it would spread the area served by Cablelink's Dublin operation, making investment in upgrading the network more cost effective, by providing a larger contiguous customer base.
CMI's main shareholder is UK venture capital company Legal & General Ventures, the investment arm of Legal & General Assurance, which supported the management buy-out in 1996 and hold slightly under 60 per cent. Another venture capital company, Barings Communications Equity, holds around 17 per cent. Management hold just under 25 per cent of the equity.
Ever since the sale of Cablelink, CMI's future as an independent organisation has been in question and it has been seen as a likely acquisition target, either by NTL or by some other group wishing to build a position in the Irish cable market.
While CMI is believed to have had discussions with a number of parties, both before and after the Cablelink sale, it is now understood that it is in exclusive talks with NTL. The negotiations, however, are believed to still have some way to go. A CMI spokesman would not comment on speculative reports.
Industry sources differ on how much CMI would be worth. NTL is seen to have paid a premium price for Cablelink. On this basis, CMI might fetch about £80£90 million for its shareholders.
CMI has already begun to upgrade its network in the Swords/ Malahide area of North County Dublin to be able to carry advanced interactive multi-media services, including internet access. Its chairman is former IDA managing director, Mr Padraic White, and its managing director is Mr Ray Doyle.
