Liberty Media in alliance with Cox for Adelphia?
[thus far Cox has said it doesn't want all of Adelphia; doesn't fit Cox's payoff focus; but we will have to see]
Liberty sees alliance with Cox in Adelphia bid
Reuters,
05.13.04, 8:35 PM ET
NEW YORK, May 13 (Reuters) - Liberty Media Corp. (nyse: L - news - people) could ally with Cox Communications (nyse: COX - news - people) to acquire part or all of bankrupt cable company Adelphia Communications Corp. <ADELQ.PK>, Liberty's Chief Executive Robert Bennett said on Thursday.
Bennett told investors on Thursday that he could see an alliance with Atlanta-based Cox in a bid for Adelphia that hinged on a swap for Cox's 25 percent stake in Discovery Communications.
"Our interest in Adelphia would be driven by our Discovery partners' interest in Adelphia," Bennett said.
While giving few specifics, Bennett said that if Cox made a bid for Adelphia, Cox and Liberty could "come up with some kind of transaction" that would let Cox swap its stake in Discovery with Liberty, in exchange for Adelphia cable systems on a tax-free basis.
Liberty Media has made no secret of its desire to increase its stake in fast-growing Discovery, which is benefiting from increased affiliate fees and advertising revenue as advertisers migrate from broadcast to cable.
Cox considers itself a pure distribution business that analysts say could stand to gain from increasing the scale of its cable television and telecommunications operations.
Discovery is 50 percent owned by Liberty, 25 percent owned by Cox and 25 percent owned by Advance Newhouse.
With deep-pocketed bidders like Comcast Communications and Time Warner Inc. in the running, Adelphia, the nation's fifth-largest cable television operator, is expected to fetch more than $20 billion in a sale.
Adelphia agreed to put itself on the block in April under pressure from creditors and shareholders, who claimed Adelphia's plan for reorganization undervalued the company by billions of dollars. |
