Comcast and Time Warner would divide cable systems in Los Angeles, Dallas, Minneapolis and several other big markets if their bid to buy...
PHILADELPHIA — Comcast and Time Warner would divide cable systems in Los Angeles, Dallas, Minneapolis and several other big markets if their bid to buy bankrupt Adelphia Communications is approved.
The proposed swaps are part of a series of transactions under which Comcast and Time Warner would buy Adelphia for $17.6 billion and divide its 5.3 million subscribers.
The deal is subject to approval by regulators and the court overseeing Adelphia’s bankruptcy case. The process could take six to nine months.
Other swaps in the proposed transaction would give Comcast systems in Washington, D.C.’s Virginia suburbs and Minneapolis, among others. Comcast would give Time Warner systems in Los Angeles and Dallas.
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In all, Comcast will pick up 1.8 million subscribers in the Adelphia deal. Time Warner will gain 3.5 million.
Comcast and Time Warner were already the nation’s two largest cable-television firms. Comcast has 21.5 million customers; Time Warner has 10.9 million.
Adelphia, the fifth-largest cable operator with 5.3 million subscribers, is operating under bankruptcy protection. Its founder, John Rigas, and two of his sons were accused of looting the company of billions of dollars. Rigas and his son Timothy are awaiting sentencing; the trial of Michael Rigas ended in a hung jury.
The transaction is subject to approval by the federal court overseeing the bankruptcy.
The systems Comcast will acquire are in “very fast-growing and exciting markets,” Comcast Chairman Brian Roberts said yesterday in a conference call with Wall Street analysts. “Almost every system we’re getting is nearby an existing Comcast market.”
From Adelphia, Comcast will acquire systems and subscribers in Florida, principally in Palm Beach and Miami; Virginia, mainly in the suburbs of Washington, D.C.; New England, mainly in the Boston and Hartford, Conn., areas and Vermont; Pennsylvania, in the Pittsburgh, Johnstown and Scranton areas; and Colorado Springs, Colo.
From Time Warner, Comcast will pick up systems in Minneapolis; Memphis, Tenn.; Jackson, Miss.; Louisiana, principally in Shreveport and Monroe; and in the Cape Coral and St. Augustine areas of Florida.
Comcast will give to Time Warner systems in Los Angeles, Dallas and Cleveland.
Several public-interest groups said Tuesday that they’d oppose the deal because it furthers what they consider to be anti-competitive media consolidation.
Roberts, however, said yesterday that he expects regulators at the federal and local level to embrace the proposed purchase.
Cablevision Systems, which has offered a competing bid for Adelphia, had no comment yesterday. On Tuesday, the judge overseeing the bankruptcy case approved a provision in the Time Warner-Comcast bid that would require any other company buying Adelphia to pay them a breakup fee of about $440 million.