UGC denies interfering in NTL management

Cable company UGC has denied interfering in the management of NTL Ireland ahead of receiving regulatory approval for the acquisition…

Cable company UGC has denied interfering in the management of NTL Ireland ahead of receiving regulatory approval for the acquisition of the company.

The pan-European firm, which plans to buy NTL Ireland for €325 million, undertook an operational review at the firm in early June. It also requested detailed subscriber information from the State's biggest cable company, according to documents and e-mails seen by The Irish Times.

The review, which was carried out by UGC executive Gene Musselman, who is president and chief operating officer of UGC subsidiary UPC Broadband, took place despite a pledge by UGC - which owns NTL's rival Chorus - not to get involved in the day-to-day running of NTL ahead of an inquiry by the Competition Authority into the sale.

UGC's ongoing contact with NTL Ireland is likely to provoke complaints of "gun jumping" by competitors and rivals that were outbid in the auction for NTL.

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It is understood that at least one submission made to the Competition Authority has argued that the way UGC plans to buy NTL does not conform with Irish law.

UGC intend to use a technique known as "warehousing", whereby its US bankers, Morgan Stanley, buy the cable firm before selling it on to UGC. This arrangement is provided for under the 2002 Competition Act but the legislation outlines that the ultimate purchasers should not take control of an asset until any deal passes regulatory scrutiny.

The first stage of the acquisition has already gone ahead and Morgan Stanley has paid NTL €325 million for its Irish firm, which has 350,000 subscribers.

UGC is now trying to buy the company from Morgan Stanley.

Documents obtained by The Irish Times show that Mr Musselman visited NTL Ireland's offices on June 7th to meet staff and undertake the operational review. A few days later, NTL managers sent e-mails containing subscriber information to UPC Broadband.

An UGC spokesman said the firm was not involved in the day-to-day running of NTL and was aware of its requirements.