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Cable Veterans Reported Interested in Adelphia Assets

Aug 27, 2004  •  Post A Comment

Three cable veterans are likely to join Comcast and Time Warner as bidders on the Adelphia Communications assets, the Wall Street Journal reported Friday afternoon.

The cable veterans-Bill Bresnan, Jerald Kent and Steven Simmons-are each backed by a private-equity firm, the article said, and each team is interested only in pieces of the Adelphia, which has 5.4 million subscribers peppered throughout the United States.

Mr. Bresnan, who started a cable company bearing his name and later sold pieces of it to Charter Communications, has partnered with Providence Equity Partners, the article said.

Mr. Kent, a founder of Charter who is now president of Cequel III, a telecommunications management firm, is reportedly working with the private-equity unit of investment bank Goldman, Sachs & Co.

Mr. Simmons, who founded and later sold a cable company and now runs Patriot Media & Communications, has teamed up with Spectrum Equity Investors.

Since buying the entire company could cost as much as $20 billion, these veterans are likely to bid on pieces of Adelphia, and are likely to at least try to vie for the most desirable systems, which are located in Los Angeles.

They could face stiff competition, however, since both Comcast and Time Warner are said to be interested in the Los Angeles system as well. The entry of the private-equity-backed players comes as Adelphia expresses a willingness to look at selling the company in pieces.

The company has said it will begin the sale process in earnest starting after Labor Day and hopes to consummate a sale by the end of the year.

But that timetable won’t be without challenges. Besides its continued move toward emerging from bankruptcy, there is an ongoing Securities and Exchange Commission probe, and the company has yet to complete its examination of its own books. In addition, some sources have noted that Adelphia could run into problems when it comes time to assign operating losses to the various assets it might sell, as well as unwinding a capital structure that has even made it difficult for the company to work toward an emergence from bankruptcy.