Daniels Cable Brokerage Will Live On

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The death of cable legend Bill Daniels may have cast a
shadow on the future of the cable brokerage that bears his name, but executives at Daniels
& Associates are intent on keeping the company going.

Daniels & Associates executives already own about 90
percent of the company, and they will acquire the other 10 percent from Bill Daniels'
estate, Brian Deevy said.

"It's pretty automatic," Deevy said about
company executives acquiring the additional 10 percent interest. "We've talked
about it, and it made sense to [Daniels]. What I've said to my guys [is that] in
honor of Bill, we're just going to go full-speed ahead."

Daniels & Associates is one of the biggest cable
brokerages in the country, and it is coming off its best year ever -- it completed 114
transactions with an aggregate value of $16 billion in 1999.

The company was also involved in some of the bigger systems
acquisitions last year, including Adelphia Communications Corp.'s $5.2 billion
acquisition of Century Communications Corp. and its $2.1 billion purchase of
FrontierVision Partners L.P.

And the brokerage was involved in a three-way system swap
between AT&T Corp., Charter Communications Inc. and InterMedia Partners involving
700,000 subscribers and worth about $2.4 billion, as well as representing Triax Midwest
Associates in its sale to Mediacom Communications Corp. for about $750 million.

This year, Daniels & Associates helped to close on Cox
Communications Inc.'s $2.7 billion acquisition of Multimedia Cablevision Inc. cable
properties with 524,500 subscribers from Gannett Co.

Daniels, one of the pioneers of the cable industry, formed
the brokerage in 1958. However, since selling the 90 percent interest to his executives in
1990, he had not been closely involved in the day-to-day operations of the business.

According to several sources, this indicates that the
current management is committed to continuing and growing the business, especially since
the past two years have been the strongest financially in company history.

In his heyday, however, Daniels was a formidable
competitor, as any broker who has gone head-to-head with him in the past is quick to tell.

"He was beloved by all," Waller Capital Corp.
chairman John Waller said. "If he had a relationship with somebody, it was very hard
to get in the middle of that. His clients were very attached to him."

Like other cable brokers, Daniels & Associates began to
diversify its business more than 10 years ago, branching out into telecommunications,
Internet and international businesses.

Most brokers have been preparing for years for a decline in
cable deals as a result of industry consolidation. And as large players are increasingly
coming from outside of the cable industry -- AT&T, Vulcan Ventures Inc. and America
Online Inc. -- most cable brokers realize that they may be left out of the loop.

"At some point, consolidation will take its
toll," said one operator who asked not to be named. "But these guys are great --
they keep reinventing themselves."

But this doesn't mean the cable side of the business
will go away. Although there may be fewer blockbuster deals, the operator said, smaller
cable companies that are looking to sell are still hiring brokers.

"Where [brokers] have made their money is in peddling
the small stuff," the operator added. "The small guys want representation on
their side."

Communications Equity Associates Inc. chairman and CEO J.
Patrick Michaels believes the current Daniels & Associates management will be able to
continue the business successfully. "I don't think there will be any
change," he said.

Michaels added that about three years ago, several cable
brokers, including Daniels & Associates, were approached by larger Wall Street firms
that were looking to get into the cable business.

While no sale happened at that time, he added that if
Daniels & Associates were to sell out now, Wall Street would be an unlikely buyer.

"The more likely buyer would be the medium-sized
brokerage firms, like A.G. Edwards [& Sons Inc.] or Raymond James [& Associates
Inc.]," Michaels said. "Medium-sized firms are more likely to try to acquire a
company like that."

Deevy said that although Daniels & Associates was in
discussions with several Wall Street firms three years ago, it was more to create
partnerships, rather than on an outright sale.

"We've always talked about partnerships, and
we'll always entertain that," Deevy said. "We'd love to do IPOs
[initial public offerings] and work in the equity and debt markets."

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