REDMOND, Wash. -- Microsoft Corp. said yesterday that it will invest $500 million in NTL Inc., the United Kingdom's No. 3 cable TV company, to push high-speed phone, video and Internet services in Britain and Ireland.
The world's largest software maker also said it will split its stock 2-for-1 in March, its eighth split in 13 years, after shares more than doubled in the past year on record sales.
Microsoft surged $5.63, to $161.88, in trading of 25.7 million shares yesterday, making it the most active U.S. stock. NTL's shares gained $12.06, to $79.75.
Microsoft's investment in the cable and telecommunications operator fits its strategy of pushing software and content for the Internet, such as the online MSN Network.
Microsoft needs faster Internet access to bolster its digital TV and Internet commerce offerings. It will use NTL as a European beachhead.
"This gives them a showcase where they can distribute and test all of their high-speed interactive products" in Europe, said Paul Sharma, an analyst at Henderson Crosthwaite Institutional Brokers in London.
Microsoft invested $1 billion in No. 4 U.S. cable operator Comcast Corp. in June 1997 to help it deploy high-speed video and data services to homes, schools and businesses. Comcast also offers telephone services.
Microsoft bought WebTV Networks, which links TV sets to the Internet, for $425 million in April 1997. WebTV Networks has 700,000 subscribers to its service, which lets users cross between TV programs and selected World Wide Web sites.
New York-based NTL owns TV and radio broadcasting towers, a national fiber-optic telephone network, and has built Britain's third-biggest cable company through its $1.54 billion acquisition of Comtel and Diamond Cable Communications PLC last year.
NTL plans to start a digital cable TV service this year, which will offer more channels, clearer pictures and sound, and interactive services such as shopping, banking and Internet access.
It said last month that it expects to buy professional soccer team Newcastle United PLC to enhance its sports programming. That purchase depends on a regulatory decision expected in March.
The split is effective March 26 for shareholders of record March 12. Microsoft went public in March 1986 at $21 a share.
Pub Date: 1/26/99