The $23 billion sale of Virgin Media has been thrown off course by the crisis in the debt markets, the company conceded today.

The television and telecoms group announced in a statement that the sale process would be extended until a “more stable debt market environment” had emerged.

Virgin refused to detail when it thought that time might come. However, some market sages have said that they believe it will be at least October until a more stable environment emerges meaning the formal auction for the quadruple-play group — which was meant to kick-off this month with first round indicative offers — may not get underway for at least two months and possibly longer.

The delay marks the latest development in Virgin Media’s tumultous history — which included a life-saving restructuring in 2002 — and the latest blow for the Nasdaq-listed group’s long-suffering investors.

An attempted sale last year failed to materialise in part because of opposition from the influential hedge fund investor Bill Huff, who was then a key shareholder in the group.

Virgin Media, the business formed from the tie-up of NTL and Telewest and Virgin Mobile, hoisted the "for sale" sign last month after an approach from Carlyle, the American buyout group.

However the credit crunch triggered by the collapse of the sub-prime loans market in the United States threw into doubt the progress of the deal and the ability of private equity groups to raise the funds required. At present the banks are closed to financing such big buyouts.

TPG, one of the world's largest buyout groups, has already pulled out of the auction, partly because of concerns about Virgin’s business model. Blackstone is also thought to be wavering.

Such mega buyout deals are likely victims of the market turmoil because private equity often piles on debt of multiples of eight times a company’s earnings to see off rivals.

In its statement Virgin insisted that it had received a “strong ongoing interest in a transaction” from both private equity and trade players.

Aside from Carlyle the group is also being looked at by another private equity consortium led by Providence and by Liberty Global, Europe’s biggest cable operator.

Virgin will be further quizzed on the deal at its second-quarter results, tomorrow.

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