Shares in Telewest have fallen sharply after a group of its bondholders rejected an offer for 20% of the cable company's bonds.

Telewest stock has already fallen so low that the latest tumble took it just 0.59 pence lower to 3.15p.

Two years ago the shares were trading at 560p.

The offer to buy the bonds came from the investment company Liberty Media which is led by the US media tycoon John Malone.

The bondholders' group said it was "sceptical" that the offer would resolve Telewest's debt problems in the best interest of the bondholders.

Under pressure The group said it wished to hold talks "urgently" with Liberty Media and Telewest to put forward its own proposals for a restructuring of Telewest's debt and had asked for a meeting this week.

The bondholders group said it had appointed US law firm Cadwalader Wickersham & Taft to advise it.

But Telewest said there was nothing new to talk about at the moment.

The cable company is under pressure to deal with the �5.3bn ($7.8bn) of debt it built up by making acquisitions during the height of the hi-tech and telecoms boom.

Liberty Media already owns 5% of Telewest's bonds and a quarter of its shares.

Bond analysts said the decision by Telewest bondholders was not surprising.

"In the event of a restructuring the bonds will be potentially worth more than Liberty Media is offering," said David Gladstone of Morgan Stanley.

Mistake

At the weekend Telewest's chairman Cob Stenham was criticised for misleading shareholders at the company's annual meeting.

He admitted that he had made a mistake by failing to tell shareholders of the finance director's �40,000 rise while assuring them that all directors pay rises had been frozen.

But he told the Sunday Times that it was a mistake and that he had not intended to mislead people.