Virgin Mobile (UK)

Virgin Mobile UK was a mobile phone service provider.

The company was launched by Virgin Group and One2One in 1999 as the world's first mobile virtual network operator (MVNO), initially using the One2One network (which became T-Mobile UK, and then EE). Virgin Mobile offered contract mobile packages, as well as mobile broadband services. It sold its services directly, as well as through price comparison sites.

NTL:Telewest bought Virgin Mobile in 2006 and rebranded itself as Virgin Media in February 2007; Virgin Mobile became part of the quadplay of Virgin Media services. Virgin Media was purchased by Liberty Global in 2013, and merged with O2 in 2021.

In 2019, Virgin Mobile entered into a 5-year MVNO agreement with Vodafone, and by 2021, began transitioning its mobile services from EE to Vodafone. However, this transition was rendered redundant following Virgin Media's merger with O2, which was completed in 2021. As a result, Virgin Mobile became an MVNO on O2’s network, and by 2022, all Virgin Mobile customer traffic was fully migrated from EE and Vodafone to O2’s infrastructure.

In January 2023, it was announced that Virgin Mobile would cease operations as a separate brand. Starting in March 2023, Virgin Mobile began transferring its customer base to O2’s direct services.

History

Virgin Mobile was launched in November 1999 as a private joint venture between One2One (later T-Mobile UK, then EE) and the Virgin Group.[2] The joint venture involved leasing network bandwidth from One2One and re-selling it under the Virgin Mobile brand, making it significantly cheaper to run than if Virgin operated its own network infrastructure.[3] This marked the world's first mobile virtual network operator (MVNO) arrangement.[4]

The company reported its first annual profit in 2003, following successful Christmas sales.[5]

In 2004 Deutsche Telekom sold their 50% holding in Virgin Mobile to the Virgin Group, with the agreement that if the company were to become public in the following two and a half years they would receive 25% of the proceeds.[6] The two companies had previously argued over the terms of the agreement made in 1999 and Richard Branson had filed a High Court action against T-Mobile.[7]

Branson had considered making Virgin Mobile public in 2002.[8] Eventually, dealing in shares of Virgin Mobile began on 21 July 2004,[9] with 37% of the shares made available for sale as an initial public offering and the rest held by the Virgin Group.[2] At the time, the company had 4.1 million customers and employed 1,400 staff in the UK; the listing valued the company at £500million.[10]

Acquisition by Telewest, 2006

In December 2005 it was announced that Virgin Mobile UK was in talks with NTL:Telewest regarding a sale. The combination of Virgin Mobile and NTL:Telewest would create the United Kingdom's first "quadruple play" media company, bringing together TV, broadband internet access, mobile phone and fixed-line phone services, and allowing NTL:Telewest to use the Virgin brand.

Under the deal, Virgin owner Sir Richard Branson was understood to be planning to swap his controlling 72% stake in Virgin Mobile for a 14% holding in NTL:Telewest, which would make the billionaire entrepreneur the biggest shareholder in the combined group, and give him a share of future revenues.

The first bid of £817million (US$1.4billion) was rejected by Virgin Mobile's independent directors, who took the view that NTL:Telewest's bid "undervalued the business." Branson was reported to be confident that a restructured deal could be completed. The offer was increased in January 2006, to £961million, or 372pence per share.

On 4 April 2006, NTL:Telewest announced a £962.4million recommended offer for Virgin Mobile. The offer had three options: 372pence per share in cash; 0.23245 new NTL:Telewest Inc. shares for each Virgin Mobile share, worth 389pence; or 0.18596 of an NTL:Telewest share, and 67pence in cash, worth in total 387p. Branson indicated that he would accept the third option, which led to him receiving at least a 10.1% stake in the newly enlarged NTL:Telewest, and helped to fund the increased 372p per share in cash for the minority shareholders.

The independent directors of Virgin Mobile indicated to NTL:Telewest that they "intended unanimously to recommend that Virgin Mobile shareholders vote in favour of the scheme". NTL:Telewest acquired Virgin Mobile on 4 July 2006, delisting it from the London Stock Exchange

type	Subsidiary
industry	Mobile telephony
foundation	November 11, 1999
founder	Richard Branson
defunct	August 31, 2023
fate	Ceased trading after merger of Virgin Media with O2; customers migrated to O2
products	Mobile telephony
parent	Virgin Media O2
homepage	https://www.virginmedia.com/mobile

History

Acquisition by Telewest, 2006

External links

References

Liberty Global, 2013

Merger with O2, and closure