Adelphia Deal Boosts Time Warner's LA Footprint
According to news reports today, Adelphia creditors have reached a preliminary agreement to sell its 5.3 million cable subscribers to Comcast and Time Warner for some $18 billion. It's expected about 70% of that total will be in cash and the rest in stock. For the cash portion, Time Warner is expected to pay $11 billion, compared to $2 billion for Comcast. According to folks on Wall Street, the stock portion of the deal will be shares in a new entity that through the combination of Time Warner Cable and Adelphia. That structure will allow Comcast to trade its 21% stake in Time Warner Cable for some 2 million Adelphia cable subscribers. The deal may also include Comcast contributing its Los Angeles area cable systems to the venture, a move that would then give Time Warner Cable a lock on that market. The expected acceptance of the Time Warner-Comcast offer would trump Cablevision Systems Corp.'s bizarre $16.5 billion bash bid for Adelphia this week. In recent years, Cablevision has intentionally jettisoned all cable systems outside the metropolitan New York City area to focus exclusively on servicing the Big Apple. Maybe with their current family squabbles involving Voom, Cablevision's Dolans have some new-found empathy for the Rigas family?