As the bidding starts on Prime Cable's Las Vegas
system, cable executives and system brokers hope that the expected high price for the
fast-growing property will help to elevate all cable-system values.
Austin, Texas-based Prime has been shopping the
370,000-subscriber system, located in a top 10 market in the fastest-growing region of the
country. Tele-Communications Inc., Comcast Corp., Cox Communications Inc. and Charter
Communications Inc. are believed to have submitted preliminary bids last week.
TCI president and chief operating officer Leo J. Hindery
Jr. said at a telecommunications conference sponsored by Bloomberg L.P. in New York last
week that TCI was interested in the system, possibly as a joint venture. TCI owns the
Reno, Nev., system. Neither Cox nor Comcast officials would comment.
"We're definitely interested," said a
Charter official, who asked not to be named. Charter doesn't have a publicly traded
stock to use as deal currency, though, which could be a disadvantage, the official said.
The Las Vegas system is mostly owned by the Greenspun
family, which also owns the Las VegasSun newspaper. They are believed to be
seeking at least $1 billion for the system, which would top industry benchmarks for system
values as a multiple of cash flow or on a per-subscriber basis. Prime Cable and BellSouth
Corp. also own stakes in the system.
Prime officials didn't return calls last week. A call
to Greenspun Inc. president Brian Greenspun last Thursday wasn't returned by press
Sun editor Greenspun told the paper that the family
does not want to sell out completely, but that it wants to consider various options,
including selling part of its 63 percent stake in the system.
The move comes at a time when public- and private-market
cable values are high. Marcus Cable, the 10th-largest cable MSO, has also decided to
consider purchase offers and other financial options.
The Las Vegas operation is complicated because Prime owns
part of the Nextlink competitive local-exchange carrier affiliate there, as well as
Hospitality Network, a cable system that serves resorts. An executive at one of the
bidding companies said Prime wants to sell the entire operation.