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Microsoft offers to sell Telewest stake

Liberty Media calling cable shots

Microsoft has offered to sell its 23.6 percent stake in financially troubled cable operator Telewest to Liberty Media, a cash rich US media investment company, for close to £214 million.

Under terms of the deal, Liberty Media has 30 days to accept Microsoft's offer. If US based Liberty Media, declines to purchase the stake, Microsoft may choose to sell off its shares to the public within three months of the expiration of the 30 day option period.

If the deal does go through, Liberty Media would boost its stake in Telewest from 25.2 percent to 48.8 percent, further solidifying its position as Telewest's single largest shareholder.

Telewest provides internet, telephone and television services to 1.8 million households, with an additional 73,600 business customers for its voice and data telecommunication-service offerings, according to information posted on the company's website. The company's cable network passes 4.9 million homes in the UK.

But despite its customer base and the reach of its network, Telewest is beset by serious financial woes, with the company posting a net loss of £117 million during the first quarter. The company has a total of £5.8 billion in debt and other financial liabilities.

In June, Liberty Media began a concerted effort to boost its stake in Telewest, offering to buy some of the company's debt from creditors in a bid to gain a seat at the table for discussions about restructuring.

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