NEW YORK- Media giants Time Warner and Comcast announced plans Thursday to jointly buy bankrupt cable group Adelphia Communications Corp. in a 17.6-billion-dollar deal, including 12.7 billion in cash.
A statement from the firms said Time Warner would pay 9.2 billion dollars and 16 percent of the shares of its Time Warner Cable unit. Comcast would contribute 3.5 billion dollars in cash.
Sources close to the deal said the total value of the deal, with the shares, amounted to 17.6 billion dollars. That was better than the 17.1 billion dollars offered by rival cable operator Cablevision Systems.
Time Warner would absorb 3.5 million of Adelphia's subscribers, bringing its total customer cable base to 14.4 million. Comcast would gain 1.5 million, bringing its total to 23.3 million.
Adelphia's board has approved the deal, which still requires regulatory approval from the Federal Communications Commission, antitrust regulators and the US bankruptcy court overseeing Adelphia's Chapter 11 proceedings.
Pending all such approvals, the transaction is expected to be completed in nine to 12 months.
The transaction "delivers maximum value" for Adelphia's creditors, the Colorado-based company said. The nation's fifth-largest cable operator plans to submit a revised reorganization plan to the bankruptcy court to reflect the transaction.
Terms also call for Time Warner and Comcast to swap some cable systems.
"As we plan the smooth integration of these new cable systems, we'll stay focused on meeting all of Time Warner's financial and operational objectives while evaluating how to best employ our significant remaining capacity to improve shareholder returns," Time Warner chief executive Dick Parsons said in a statement.
"These transactions underscore our belief that there has never been a better time to be in the cable business," said Comcast CEO Brian Roberts.
04/21/2005 12:50 GMT