BP Amoco said its Crazy Horse well indicated a discovery of at least 1 billion barrels.. FLEXTECH, BRITAIN’s largest producer of basic-tier television channels for cable and satellite, is close to buying BSkyB’s 9.5 per cent interest in Granada Sky Broadcasting in a deal that would value the company at some pounds 160m, people familiar with the situation said last night. The terms of the buyout of BSkyB’s interest, which would be valued at pounds 15m, weren’t immediately available.
Flextech is also understood to be prepared to buy out Granada’s 90.5 per cent interest in GSkyB, but no agreement has yet been reached. One option is for Flextech to swap its 18.6 per cent interest in Scottish Media, worth pounds 105m, for Granada’s GSkyB stake.In March, Granada paid pounds 110m for Mirror Group’s 18.6 per cent holding in Scottish.GSkyB broadcasts three channels distributed over satellite, cable and ONdigital. Its channels include Men & Motors, repeats channel Granada Plus and Breeze, which offers woman’s lifestyle and entertainment programming. Launched in late 1996, the venture was designed to match Granada’s programming library with BSkyB’s pay-TV marketing and distribution muscle.The channels reach 95 per cent of UK multichannel homes and attract 3 million viewers a week, but are not believed to be profitable. After launch in late 1996, GSkyB was hurt by low viewership and underwent a number of changes in management and its channel portfolio.Much of the original output of the channels is produced at a dedicated digital studio facility in Manchester owned by Granada.

It is expected that Granada would continue to supply original programming as well as repeat programs such as Coronation Street.Adam Singer, chief executive of Flextech, has said the company’s scale exercises a “gravitational” pull on other channels. He has been negotiating to acquire the GSkyB channels for some weeks and is also thought to be looking at the possible acquisition of cable-only channel LiveTV from Mirror Group.”Everybody faces the same issue of scale and the problem of cross promotion,” Mr Singer said recently, while declining comment about any acquisitions.”Clearly, if you have 12 channels you’re in a much better position than if you have three. I think you’ll see us increase our portfolio.”Granada shares closed up 36p at 663p, while BSkyB ended up 3.5p at 594p Shares in Flextech were unchanged at 1020p.. THE BID battle over the residential cable network of Cable & Wireless intensified last night when sources close to Telewest Communications, the country’s second biggest cable network operator, said talks with CWC were “quite far advanced” and could result in a deal by next week. Telewest has been in talks to acquire CWC’s residential business since the Spring.
It also emerged that Telewest’s biggest shareholders, Microsoft with a 29.9 per cent interest and Liberty Media with 20 per cent, are prepared to provide cash to seal a deal.

Microsoft has balance sheet reserves of $20bn, while Liberty, now part of AT&T, has a $5bn cash war chest.Telewest’s intervention coincided with news last night that France Telecom has agreed to pay $1bn for a 10 per cent stake in NTL, the number three cable operator. Jean-Louis Vinciguerra, executive vice president of finance, said France Telecom is prepared to invest an additional “few billion dollars” in a rival cash and stock bid for CWC assets.Should it succeed, France Telecom will enlarge its NTL holding to become the largest shareholder, although Mr Vinciguerra said it would not end up with a majority stake.He refused to confirm reports NTL would be backed by the French company with sufficient cash to fund an pounds 8bn bid. Analysts had valued CWC’s residential network at pounds 6bn.France Telecom has $3bn in cash reserves, but expressed readiness to borrow, either short-term bridging funds or issue bonds. “A few billion dollars is not a key issue for France Telecom,” Mr Vinciguerra said. The French company also has a 2 per cent stake in Deutsche Telekom worth $2bn that it intends to sell.”(NTL) has very strong and aggressive management,” he said, commenting on why France Telecom would back Barclay Knapp, the US entrepreneur who is NTL’s chief executive.”The idea for France Telecom is to have access to the second local loop,” he said, referring to the line that connects homes and businesses to telephone companies’ trunk network. “It’s exactly what AT&T did in the US when it bought cable companies.”Outlook, page 21.

FRANCE TELECOM last night agreed to pay $1bn (pounds 640m) for a 10 per cent stake in NTL, the number three cable network operator, and is prepared to invest “a few billion dollars” more to back a cash and stock bid for the residential cable assets of Cable & Wireless Communications (CWC), the number one operator. Should the bid succeed, Jean-Louis Vinciguerra, executive vice president of finance, also said France Telecom would enlarge its NTL holding to become the largest shareholder, but would stop short of having a majority stake.
“We will have to add a few billion dollars to the first $1bn” if NTL’s offer for CWC’s residential cable business succeeds, he added.France Telecom has $3bn in cash reserves, but is willing to borrow additional funds. “A few billion dollars is not a key issue for France Telecom,” said Mr Vinciguerra. The French company has a 2 per cent stake in Deutsche Telekom, worth $2bn, that it intends to sell.The bid battle over CWC further intensified last night when sources close to Telewest, the country’s second-biggest cable operator, said talks with CWC, begun in the spring, were “quite far advanced” and could result in a deal by next week.It emerged that Telewest’s biggest shareholders, Microsoft with a 29.9 per cent interest and Liberty Media with 20 per cent, are prepared to provide cash to conclude a deal. Microsoft has balance sheet reserves of $20bn, while Liberty, now part of AT&T, has a $5bn cash war chest.Mr Vinciguerra refused to confirm reports that NTL would bid pounds 8bn for the CWC assets, comprising pounds 6bn in cash and shares, and the assumption of pounds 2bn in debt.