Time Warner Inc. and Comcast Corp., the two largest cable TV companies in the country, announced Thursday that they had reached an agreement to buy the assets of the bankrupt cable company Adelphia Communications Corp.
The deal beat out a last-minute bid by Cablevision Systems Corp., a New York area cable TV company. The joint bid from Time Warner and Comcast had been favored to win. The deal is subject to bankruptcy court approval.
Time Warner and Comcast will pay $12.7 billion in cash and 16 percent of the stock in Time Warner’s cable subsidiary, Time Warner Cable Inc., which will become a publicly traded company at the time the deal closes.
As part of the deal, Comcast will redeem its 21 percent interest in Time Warner Cable and pay about $1.5 billion in cash, getting 1.8 million cable subscribers in exchange. Time Warner will get 3.5 million subscribers.
After the deal closes, Comcast will maintain its lead as the largest cable TV company in the country, with 23.3 million customers, and Time Warner will remain No. 2 with 14.4 million subscribers.
