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Adelphia Reportedly Not Pushing for Joint Bid From Consortium

Nov 12, 2004  •  Post A Comment

Adelphia Communications is not encouraging a consortium of private-equity firms to jointly submit a bid for the bankrupt cable operator, and Adelphia CEO William Schleyer isn’t working with the consortium considering a play for the company, a person familiar with the situation said Friday.

The New York Times reported Friday that a group of private-equity firms — including Thomas H. Lee Partners, Providence Equity Partners and Kohlberg, Kravis Roberts — is mulling a joint bid of as much as $18 billion for Adelphia. The cable operator was put up for sale earlier this year and is presently trying to emerge from bankruptcy protection.

The person familiar with the company’s thinking said the article’s suggestion that Mr. Schleyer would stay on to lead the company if the private-equity team’s offer were to prevail is unfounded, and said Mr. Schleyer has not held discussions with the consortium about any role he might have should it end up buying the company.

In addition, the source refuted the article’s assertion that the cable company is encouraging the private-equity firms to team up in order to submit a bid.

News of a possible private-equity consortium being put together for Adelphia is the latest twist in the closely watched auction. Adelphia, facing pressure from creditors, put itself up for auction in April and is expected to receive bids for pieces or the entire company by January.

Should the private-equity firms join forces, they would likely rival an offer expected from the No. 1 and No. 2 cable operators, Comcast and Time Warner Cable, which are exploring submitting a combined offer for all of Adelphia.

At the same time that it entertains offers for either part of all of the company Adelphia is also moving ahead with a process that would bring it out of bankruptcy as a standalone company.

An Adelphia spokesman said the primary goal of the two processes is to get as much value out of the company as it can to pay back creditors.

“We’re committed to a fair and robust process that is designed to achieve maximum value for our bankruptcy constituents, and no bidder, group of bidders or solution is being favored,” said an Adelphia spokesman. “Our management is committed to the integrity of the process. That is paramount.”