高盛与摩根士丹利交易台对Virgin Media O2困境债券看法分歧，债务重组风险指向债权人而非明确股权利空

Traders at Goldman Sachs Group Inc. and Morgan Stanley are split over the value of Virgin Media O2’s battered bonds, which plunged deep into distressed territory this month.

Goldman Sachs traders see much of Virgin Media’s bad news as already priced in, including the risk that UK regulators block Nexfibre Networks Ltd.’s acquisition of Netomnia Ltd. and deprive Virgin Media of expected cash proceeds, according to people familiar with the matter.

Morgan Stanley’s trading desk is taking the other side, recommending investors sell or short Virgin Media’s bonds amid the mounting risk of a debt overhaul, according to separate people familiar with the matter, who asked not to be identified discussing private information.

Virgin Media’s 10-day bond rout has pushed some of its debt deep into distress and spilled into the broader high-yield market, where the company is a significant index borrower. As of Oct. 9 Virgin Media was the seventh-largest member of the Bloomberg Pan-European High Yield Index, with its mix of 11 sterling and euro-denominated bonds making up over 1.2% of the gauge.

The selloff has rattled investors, who pressed executives from shareholder Liberty Global Ltd. for answers at a leveraged-finance conference in London.

Read More: Liberty Meetings Draw Crowd in London as Virgin Media Bonds Sink

A spokesperson for Morgan Stanley declined to comment. A spokesperson for Goldman Sachs didn’t respond to a request for comment.

Traders at Goldman, which had been recommending some of Virgin Media’s shorter-maturity bonds last month, point to the company’s other options for cutting leverage, including a network spinoff and reductions in capital and operating spending, the people said.

The Netomnia deal also remains alive, with the Competition and Markets Authority due to rule by Dec. 15.

Oct. 16Deadline for proposed remedies to CMA concerns on Nexfibre/Netomnia dealOct. 23Deadline for public comments on CMA interim findingsNov. 3VMED to report Q3 2026 resultsDec. 15Final deadline for CMA ruling

Regulatory approval of the Netomnia acquisition would buy the company more time before it has to address its debt, but by itself isn’t enough to head off a debt overhaul, Morgan Stanley traders argue.

They see a rework as a likely scenario — one that takes the form of a liability management exercise that leaves creditors worse off. They estimate that Virgin Media can only sustain about £14 billion ($18.5 billion) of debt, well below the roughly £22 billion the company recently reported.

Liberty’s management, when asked by investors last week whether they would commit to not carrying out an LME, said they’re not at the stage where they’re making those decisions.

Virgin Media can’t deleverage fast enough before maturities start coming due in 2029, and any refinancing would come at a steep price, the Morgan Stanley traders argue.