Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Charter Communications (CHTR) -- Ignore unavailable to you. Want to Upgrade?

To: Sarkie who wrote (178)	11/6/1999 8:50:00 PM
From: KLP	Read Replies (1) \| Respond to of 2437

In the news today from Bellevue, WA re Charter.... Also, same paper has a good deal of Microsoft information today... Good Luck to All~ KLP eastsidejournal.com Mammoth IPO next step to Allen's `Wired World': Stock offering to link up cable acquisitions Saturday, November 06, 1999 -------------------------------------------------------------------------------- By David A. Grant -------------------------------------------------------------------------------- Assistant Business Editor BELLEVUE -- Microsoft co-founder Paul Allen will string another line along his ``Wired World' this coming week with the $3 billion initial public offering of stock in his cable company, Charter Communications Inc. The IPO, likely to take place on Monday, will consolidate in one publicly owned holding company 28 cable operations that Allen has acquired during the past five years. St. Louis-based Charter is now the fourth-largest operator of cable TV systems in the nation. Including its pending acquisitions, it has 6.2 million customers. Charter plans to offer 170 million shares at $17 to $19 per share. The ticker symbol of the new company, which will be traded on the Nasdaq stock exchange, is CHTR. Though Charter's offering would be one of the largest IPOs of the year, it won't be the biggest one of the week. Atlanta-based United Parcel Service Inc., the world's largest package delivery company, could raise as much as $5.36 billion this coming week in the biggest IPO in U.S. history. It expects to sell 109.4 million shares for $47 to $49 apiece. Allen, the Mercer Island billionaire, will be firmly in control of Charter when it goes public. He already owns a $1.32 billion piece of Charter and more than 43.4 million shares worth $750 million. In addition, through his ownership of Class B common stock, Allen will control approximately 95 percent of the voting power of Charter's capital stock and will be able to appoint all but one member of Charter's board of directors. In 1998, Allen bought Charter Communications for $4.5 billion and paid $2.78 billion for Dallas-based Marcus Cable. So far this year, he has snapped up eight more cable companies for a total of $4.2 billion. Three more acquisitions, worth another $9.8 billion, are pending. Charter's business consists of traditional cable services, digital cable television, interactive video programming that allows information to flow in both directions and provides high-speed Internet access. It is also working on integrating telephone services with the Internet through the use of cable. Charter filed a registration statement with the Securities and Exchange Commission on Thursday that reveals a number of insights on the company and Allen's vision for building his so-called Wired World: The company plans to use the proceeds from the IPO and Allen's contributions through his company Vulcan Cable III Inc. to pay for pending acquisitions. But those sources of funds will not be sufficient to cover the pending acquisitions and other obligations, so the company will need to raise up to $5.41 billion more. As of June 30, including pending acquisitions, the total debt was about $13.1 billion and stockholders equity was $2.8 billion. Allen's control of voting power over Charter Communications, Inc.'s capital stock means that he will be in command of the company even if he owns a minority economic interest in the business. And even though Allen's other business interests may conflict with the interests of Charter, he will be able to continue. The company's losses are also increasing, going from $5 million in 1997 to $23 million in 1998 and $216 million for the first six months of 1999. ``We cannot predict what impact, if any, continued losses will have on our ability to finance operations in the future,' according to the statement. On Allen's use of cable: ``The introduction of these new services represents an important step toward the realization of our Wired World vision, where cable's ability to transmit voice, video and data at high speeds will enable it to serve as the primary platform for the delivery of new services to the home and workplace.' Among his other holdings, Allen, 46, owns the Seattle Seahawks professional football and the Portland Trailblazers pro basketball teams; has a big piece of Dreamworks SKG, the start-up Hollywood film venture; and founded Bellevue-based Asymetrix Learning Systems Inc., which changed its name in October to click2learn.com inc. Through his Bellevue-based Vulcan Ventures investment firm, Allen also owns a 9.2 percent stake in Bellevue-based online pharmacy drugstore.com and has invested in many other high-tech start-up companies. Frank Catalano, a local analyst of the high-tech industry, said Allen's Wired World vision may not have changed, but the way he is trying to accomplish it, via cable TV systems, has changed. `` It makes perfect sense to own the delivery mechanism, the infrastructure and the content. He used to focus more on content, but realized it doesn't do lot of good without the delivery mechanism,' Catalano said. ``I find it interesting the way he is cobbling together a vision.' David Grant can be reached at david.grant@eastsidejournal.com or 425-453-4237. --------------------------------------------------------------------------------