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TCI, Time Warner to Shift Cable Systems

September 04, 1997|From Reuters

ENGLEWOOD, Colo. — Tele-Communications Inc. and Time Warner Inc. agreed to swap and combine cable systems, involving about 2 million customers, the biggest step yet by the nation's largest cable companies to reduce their debt and boost profits.

The series of transactions, which include three joint ventures, would allow Tele-Communications to shift about $3.35 billion of its consolidated debt from its books, and Time Warner would cut its debt by $650 million.

The combinations are the latest by the nation's cable companies, which have been consolidating their operations to ease their heavy debt loads. And by increasing the number of customers in certain key markets, cable operators can also become more efficient, reduce costs and cut better deals with programmers.

TCI's shares fell 6 cents to close at $17.56 on Nasdaq, and Time Warner's fell 75 cents to close at $51.63 on the New York Stock Exchange.

When these transactions are completed next year, pending regulatory approval, New York-based Time Warner will displace TCI as the nation's biggest cable company.

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