Revamped Telewest in bond deal

CABLE TV group Telewest is set to return to the bond market only months after emerging from a £5bn financial restructuring.

Telewest has only just completed a deal for original lenders to receive shares in the company in exchange for £3.5bn of bonds. The company's assets were not enough to repay bondholders, but they accepted a lower value and have effectively taken control of the business.

Original shareholders have effectively seen the value of their investment in the company wiped out.

Bonds are a form of lending that carry less risk than shares, but have a lower, if predictable, repayment rate. Telewest is still about £2bn in debt to its banks but now its balance sheet looks healthier, City sources say lenders are keen to offer bonds to replace those loans.

'It will save money and make the balance sheet more stable,' said one source.

Last month, Telewest reported record numbers of broadband internet customers signing up, though it still lost £126m in the three months to June 30.