Coudersport, Pa. -- Adelphia Communications Corp. announced
Dec. 23 that it has signed a definitive agreement to buy Verto Communications Inc. in
order to expand in the Scranton, Pa., area.
Adelphia said on Dec. 23 it will issue 3 million shares of
its class A common stock -- worth about $128 million at the Dec. 22 closing price of
$42.56 per share -- and assume about $32 million in liabilities in the deal. Verto, which
has 56,000 subscribers in greater Scranton, will generate about $13.7 million in operating
cash flow on $25.7 million in revenue during the 1999 calendar year. The $160 million
purchase price works out to about $2,800 per subscriber, or 11.5 times cash flow.
Adelphia has about 2.3 million customers, including about
100,000 in the Scranton area after the Verto deal closes.