AT&T and Cablevision Agree to Swap and Sell Cable Systems To Enhance Regional `Super Clusters’ – Company Business and Marketing
AT&T (NYSE: T) and Cablevision Systems Corporation (NYSE: CVC) Tuesday announced that they have entered into agreements under which AT&T will receive cable systems serving approximately 357,850 subscribers in Boston and Eastern Massachusetts. In return, Cablevision will acquire systems serving approximately 125,500 subscribers in the northern New York suburbs, and approximately $878 million in AT&T stock and approximately $284 million in cash, subject to certain adjustments. The transactions create larger and more efficient geographic clusters for each company.
“The Boston properties are in an attractive metro market for us,” said AT&T Chairman C. Michael Armstrong. “This move gives AT&T a new regional cluster through which we can offer customers a wide range of communications, information and entertainment services under our brand.”
When the transactions are completed, together with AT&T’s pending acquisition of MediaOne and recently announced transaction with Charter Communications, the Boston area systems will form AT&T’s largest cluster, passing approximately 3.5 million homes and serving approximately 2.1 million customers.
“Tuesday’s action accomplishes several key objectives for Cablevision,” said James L. Dolan, Cablevision president and CEO. “Together with the sale of our Ohio properties to Adelphia, it sharpens our focus on the New York market, helps speed the delivery of new digital products and services to our customers, and deleverages the company’s balance sheet.”
Mr. Dolan continued, “We have been honored to serve the residents of Massachusetts for the past 20 years, and we are confident that AT&T will operate these systems in a first-rate manner.”
In the transactions announced Tuesday, Cablevision will acquire MediaOne cable systems in Westchester, Rockland, Putnam, Orange, Ulster and Dutchess counties. At the close of the transactions, Cablevision’s New York-area cluster will pass more than 4 million homes and serve approximately 2.9 million households in New York, New Jersey and Connecticut.
The agreements, which have been approved by the boards of AT&T and Cablevision, will be subject to necessary government and regulatory approvals and are expected to close by year-end 2000. The transactions are subject to completion of the AT&T/MediaOne merger, as well as to customary closing conditions.
The number of shares of AT&T common stock to be used in the transaction will be set based on the daily weighted average trading price during the 20 trading-day period ending three trading days prior to the closing.
AT&T was advised by Goldman Sachs, and Cablevision was advised by Bear, Stearns & Co., Inc. and Merrill Lynch & Co., Inc.
AT&T Corp (www.att.com) is among the world’s premier voice, video and data communications companies, serving more than 80 million customers, including consumers, businesses and government. With annual revenues of more than $62 billion and 148,000 employees, AT&T provides services to customers worldwide. Backed by the research and development capabilities of AT&T Labs the company runs the world’s largest, most sophisticated communications network and has one of the largest digital wireless networks in North America. The company is a leading supplier of data and Internet services for businesses and offers outsourcing, consulting and networking-integration to large businesses. It is also one of the largest Internet service providers for consumers in the U.S. Through its recent and pending cable acquisitions, AT&T will bring its bundle of broadband video, voice and data services to customers throughout the United States.
Cablevision Systems Corporation is one of the nation’s leading entertainment and telecommunications companies. Its cable television operations serve more than 3.4 million subscribers located primarily in the New York metropolitan area. The company’s advanced telecommunications offerings include its Lightpath commercial telephone service and its Optimum-branded high-speed Internet service. Cablevision’s Rainbow Media Holdings, Inc. subsidiary operates entertainment businesses, including Madison Square Garden and its sports teams, American Movie Classics, Bravo, FOX Sports Net, Radio City Entertainment and Radio City Music Hall. The company also owns and operates THE WIZ consumer electronics stores and Clearview Cinemas in the New York metropolitan area. Information about Cablevision Systems Corporation, as well as background on its executives and other materials, can be accessed on the Web at www.cablevision.com.
MediaOne Group (NYSE: UMG) is one of the world’s largest broadband communications companies, bringing the power of broadband and Internet to customers in the United States, Europe and Asia. The company also has interests in some of the fastest-growing wireless communications businesses outside of the U.S. For 1999, the businesses that comprise MediaOne Group produced $7.8 billion in proportionate revenue. On May 6, 1999, the company entered into an agreement to merge with AT&T.
COPYRIGHT 2000 EDGE Publishing
COPYRIGHT 2000 Gale Group