Virgin Media Inc. (the “Company”) Seeks Amendments to Further Optimise Senior Credit Facilities Agreement

LONDON--(BUSINESS WIRE)--Virgin Media Inc. (NASDAQ:VMED) (LSE:VMED), a leading UK entertainment and communications business, today announced that it is seeking the consent of its lenders to make certain amendments to its Senior Credit Facilities Agreement dated 16 March 2010, as amended and restated on 26 March 2010 (the “SCF”).

The proposed amendments to the SCF are intended to increase the Company’s operational flexibility and provide for greater flexibility in accessing the capital markets under the SCF, whilst continuing to underscore a commitment to financial discipline. Key terms of the proposed amendments include, amongst others, fixing total net leverage at not more than 3.75 times operating cash flow from year-end 2011 (reduced from 4.3 times for year-end 2011 under current terms), and increasing the ability of the Company to incur secured debt to a maximum of 3 times operating cash flow. Both reflect the Company’s de-leveraging profile and its growing access to lower-cost pools of capital, and do not impact the Company’s capital return programme announced in July 2010. The Company is also seeking to eliminate certain restrictions on using the proceeds of additional indebtedness for the payment of dividends or distributions to the Company. A fee of 20 basis points is being offered to each lender that consents to the proposed amendments.

Separately, Term Loan A lenders under the SCF are being offered the opportunity to extend their portion of the Company’s June 2014 scheduled amortisation payment of £200 million by one year, to June 2015. After giving pro forma effect to repayment of scheduled amortisations through 2013, totalling £525 million, this would result in total amortisations of £1.15 billion in 2015, commensurate with the Company’s prudent approach toward possible future refinancings. A fee of 15 basis points is being offered to each Term Loan A lender that agrees to the extension.

The company has already received the approval of the ten lenders that supported the existing SCF signed in March 2010 for both the amendment and the 2014 amortisation extension, representing approximately 57% of the voting rights under the agreement. Responses from the remaining lenders on the proposed amendments are due 14^th February 2011.