Rigas-Owned Systems Complicate Adelphia Auction9/24/2004 9:29 AM Eastern
As the auction for Adelphia Communications Corp. gains steam, the specter of the MSO’s founding Rigas family threatens to complicate an already-complex situation.
Adelphia last week agreed to offer its 5.3 million subscribers in seven separate clusters -- a move that was made to ensure a robust auction for the systems. But included in those clusters are about 230,000 subscribers that are owned by the Rigas family and managed by Adelphia.
Former Adelphia chairman John Rigas and his sons -- former chief financial officer Timothy and former executive vice president of operations Michael -- resigned from Adelphia in 2002 in the midst of an accounting scandal.
John and Timothy Rigas were convicted on 18 counts of fraud and conspiracy in U.S. District Court in Manhattan July 8. The next day, a mistrial was declared on 17 counts in the indictment against Michael Rigas.
Sentencing for John and Timothy Rigas is expected in October -- about the same time the U.S. attorney will make a final decision as to whether it will attempt to try Michael Rigas again.
Adelphia is mulling several different options to solve the ownership problem of the Rigas-family properties, including buying them from the family.
“That’s potentially an option, although that doesn’t necessarily do the trick,” Adelphia chairman and CEO Bill Schleyer said in an interview. “The banks still have some rights, also.”