The sale of the UK assets of Tiscali to British Sky Broadband Plc that seemed a certainty last month is today very much facing jeopardy, as the value of the Sterling erodes against the Euro, says reports. The deal would had taken place by now is all had gone well. Mario Rosso, the chief of Tiscali seems to be saying in the circumstances that to pull off the deal is almost impossible.
The UK assets of Tiscali that were worth around GBP 600 million one year back, was promised to the BskyB's bid of a bit less than GBP 450 million. In the present circumstances this amount seems highly generous. Tiscali, widely held as a mediocre broadband supplier owns the Home Choice/Video Networks service that has struggled since its launch.
The situation also forces one to presume that Tiscali broadband also had been very much anticipating this deal, for now the ISP is contemplating on asking its banks to suspend its interest and covenant payments for at least a couple of weeks. The long-term debt, as of Dec 31 stood at 500 million Euros. Moreover, the fears of the investors are also mounting over the UK ISP's ability to make a comeback, as debts are mounting and Tiscali shares losing 83 percent over the past year.
09-03-2009
