The months-long auction of Adelphia Communications Corp. has finally concluded, with the bankrupt cable operator agreeing to sell the company to Time Warner Inc. and Comcast Corp. for $17.6 billion.
Adelphia will receive $12.7 billion in cash and 16% of the common stock of Time Warner's cable division, Time Warner Cable.
The deal calls for the two buyers to divvy up Adelphia systems serving 5.2 million subscribers scattered across 31 states. Further, Time Warner and Comcast will swap systems from their existing portfolios to create stronger geographic clusters.
At the end of the day Time Warner will be the largest cable operator in the Los Angeles market, in which it has been a relatively small player.
Comcast will substantially strengthen its position in South Florida, with nearly every cable system from the Florida Keys north to West Palm Beach.
But unloading existing systems means that Comcast will exit Dallas, Los Angeles, and suburban Cleveland. Time Warner Cable will exit Minneapolis, Memphis and Jackson, Miss.
From the Adelphia portfolio, Time Warner will get systems in upstate New York, most notably Buffalo; California; Cleveland; North and South Carolina, and Maine.
Comcast will get Adelphia systems in South Florida, suburban Washington; Vermont; suburban Boston and Hartford, Conn.; Pennsylvania, and Colorado Springs.