Per-sub eye-popper


It's only fitting that Bill Daniels would go out as a record breaker-to the tune of $6,200 per sub.

Adelphia Communications set a new system price record in a deal for the late Daniels & Associates founder's two remaining cable systems in Carlsbad and Desert Hot Springs, both California. The properties, serving 60,000 customers, are expected to go for about $370 million, or $6,200 per subscriber and 22 to 25 times cash flow. Daniels, the legendary cable system broker who died March 7, had a hand in the formation of virtually every major MSO over the past 35 years.

The price is astonishing for two reasons. First, with interest rates up and stocks down, everyone's cost of capital is rising, so system values should be falling from last year's record-breaker of $5,400 per subscriber. Second, the properties fit tightly with the geography of losing bidder Cox Communications' San Diego/Orange County operations, less so with Adelphia's L.A. cluster. "I would expect Cox to bid these up, not Adelphia," said one securities analyst.