Bring on the bidding war...
NEW YORK (CNNfn) - Microsoft Corp. has signed a
"confidentiality agreement" with cable company
MediaOne Group Inc. to explore how the software giant
might contribute to a possible new buyout bid by
Comcast Corp., a source close to the matter said
Thursday.
Wading into the bidding war for MediaOne,
Microsoft is showing an increased interest in stopping
AT&T Corp. from nabbing an even-larger slice of the
U.S. cable market.
Microsoft owns a 5 percent stake in Comcast, which
already has a $48 billion merger agreement with
MediaOne. But last week, long-distance giant AT&T
(T), fresh off its buyout of cabler Tele-Communications
Inc., stepped in on Comcast's deal and offered $58
billion for MediaOne.
Under the terms of its deal, Comcast requested that
MediaOne provide operating information to Microsoft
which may help Comcast save its embattled buyout bid
for MediaOne.
Spokesmen from MediaOne and Microsoft each
declined comment.
The agreement between MediaOne and Microsoft
comes just days after sources said Comcast had sought
support of Microsoft and Internet company America
Online Inc., to salvage its agreement with MediaOne,
announced on March 22.
MediaOne and AT&T, which unveiled a
confidentiality agreement of their own earlier this week,
have been in closed-door talks this week to draft a
formal merger deal by as early as the weekend, sources
said. Comcast would have five days to respond.
The maneuvering by Microsoft is seen as a
preparatory step if AT&T and MediaOne should strike
a deal.
Microsoft has expressed a strong interest in cable
companies, most notably in its purchase of a $1 billion
stake in Comcast last year. And Microsoft clearly has
the financial wherewithal to up that stake in cable -- in
its recent third-quarter report, the software kingpin was
holding $21.8 billion in cash.
America Online, meanwhile, is sitting on a stock
market gold mine. Its shares have risen about 80
percent since the start of this year.
On Thursday, Dow issue AT&T fell 1-1/16 to
53-1/8, AOL (AOL) shed 1-5/8 to 141-3/8, MediaOne
(UMG) dropped 11/16 to 79-3/8; Microsoft (MSFT)
edged down 1/16 to 82-1/16 and Comcast (CMCSA)
added 3/8 to 63-5/8. |
