Adelphia seeking bids for cable system

Posted 8:36AM on Thursday 9th May 2002 ( 23 years ago )

PHILADELPHIA - Adelphia Communications Corp. said Wednesday it will seek bids for cable television systems that include nearly half of its 5.7 million subscribers in an effort to reduce debt that has delayed the filing of its 2001 year-end financial statement for weeks. The nation's sixth largest cable company issued a news release after the market closed saying it would solicit formal bids for systems in the Los Angeles area with more than 1.2 million subscribers, in Florida with about 750,000 subscribers, in Virginia with about 575,000 subscribers and elsewhere in the Southeast with 225,000 subscribers. "Based on the many informal expressions of interest we have received in recent weeks ... I am confident that the steps we are taking will enable us to achieve our objectives of reducing debt, deleveraging our balance sheet, and creating a stronger Adelphia," said John J. Rigas, the company's founder, chairman and chief executive officer. "The company could potentially raise, in our view, up to $12 billion dollars" if all those systems were sold, said Aryeh Bourkoff, fixed-income analyst at UBS Warburg. That would not only enable Adelphia to significantly reduce debt "but also raise significant liquidity," Bourkoff said. "Many of these properties are in their best markets," meaning they shouldn't be difficult to sell, Bourkoff said. He said the Southeastern operations include systems in the Carolinas and Georgia. Adelphia's stock closed at $6.44 a share, up 73 cents, before Wednesday's announcement. That was a slight rebound from levels following the company's announcement late last week that it expects to restate financial results for 1999, 2000 and 2001 to reflect $1.6 billion of off-the-books debt as liabilities. The stock was still down about 70 percent from the $20.39-a-share price before the company disclosed $2.3 billion in off-the-books debt in connection with its March 27 fourth-quarter earnings report. The company said it might be liable for some of the debt, incurred by the Rigas family through co-borrowing with family-controlled partnerships, should the partnerships default. Adelphia had confirmed on April 3 that it was the subject of a formal Securities and Exchange Commission investigation after failing to file its annual 10-K financial statement due April 1. The company said April 18 it had been notified by Nasdaq that it faced delisting of its stock due to the delayed 10-K. A hearing is scheduled with Nasdaq on May 16. Adelphia said on April 4 it had hired three investment banks to explore possible sale of cable assets and other ways to reduce the debt. Its systems have more than 5.7 million subscribers in 32 states and Puerto Rico.

http://accesswdun.com/article/2002/5/194875