Page last updated at 11:26 GMT, Monday, 9 March 2009

Tiscali sale talks with BSkyB end

Tiscali
Tiscali shares were suspended in Milan after a 40% drop

Internet provider Tiscali said talks with broadcast giant BSkyB over the sale of its UK assets have ended.

Tiscali said it was "de facto impossible" to proceed with the discussions because of the impact of the continuing economic downturn.

As a result, Tiscali said it would miss an interest payment on its debt as it seeks to restructure its obligations.

Shares in the Italian firm declined 40% in Milan on the news before trading was subsequently suspended.

Tiscali put itself up for sale last year and began talks over the sale of "certain UK assets" to BSkyB in November.

Payments due

"Due to the worsening of the market environment in which the potential buyer also operates, the board of directors has acknowledged that it is de facto impossible to proceed," Tiscali said.

Tiscali has about 500m euros ($629m; 453m) of outstanding debt. Its next interest payments, for 11m euros, are due on 11 March and 13 March.

The company has asked for its interest payments to be suspended for a period while it restructures its debt.

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