Cable company Comcast confirmed on Friday that it is in
negotiations to buy the 76ers, the Flyers and the new CoreStates
Center, according to the PHILADELPHIA INQUIRER. A release from
the company noted "No agreements have been reached," but added:
"As one of the largest providers of communications and
entertainment services in the Philadelphia region, the Company
believes that it is uniquely positioned to promote and market the
facilities and sports franchises under discussion." One source
involved in the talks said, under a best-case scenario, a deal
could be reached by the end of this week. The source believed
the deal was "past the point of no return." Ed Snider, Flyers
Owner and Spectacor Chair, would receive $100M or more for his
majority stake in the team and arenas (including the CoreStates
Spectrum next door). Snider is expected to retain a 40% share in
both. For Snider, the deal means getting out from under the debt
burden for the new $232M arena (Sokolove, Knox & McCoy,
PHILADELPHIA INQUIRER, 3/16).
FINANCIAL MARKETS LEERY: Following word of the offer on
Friday, Comcast's shares fell ending down $1.375 or 7.2% at
$17.625. According to the WALL STREET JOURNAL, "Analysts said
they were concerned that Comcast was going outside its core cable
business just as it faces fierce competition from telephone and
satellite-dish companies. They also were worried that any deal
could dilute the value of the company's stock." Bear Stearns
analyst Raymond Katz said he cautioned his investors on the
"volatile nature" of pro sports (Mark Robichaux, WALL STREET
JOURNAL, 3/18). Andrea Knox examines the deal in light of
increased competition in the cable industry (PHILADELPHIA
INQUIRER, 3/17).
