LMI: We’d Sell Puerto Rico Subs

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Liberty Media International Inc. said Friday that it would be open to selling its 120,000 cable subscribers in Puerto Rico, especially if Comcast Corp. ends up with cable properties on the island as part of its deal with Time Warner Inc. to acquire Adelphia Communications Corp.

Adelphia owns about 147,000 subscribers in San Juan in a 50-50 partnership with ML Media. Those systems have been on the block for years, but they are not included in the pending $17.6 billion purchase of the Denver-based MSO by Time Warner and Comcast.

On a conference call with analysts Friday to discuss LMI’s first-quarter results, Liberty Media Corp. chairman John Malone said that although the status of the San Juan systems remains unclear, it would be particularly attractive for LMI if Comcast were to gain control of those properties.

“The reason I say that is Comcast continues to be a fairly large LMI shareholder,” Malone said on the call. “If, in fact, we could work something out over the next couple of years to consolidate our operations, and then ultimately swap Comcast our interest in a consolidated Puerto Rico for their stock in LMI, it would be very tax-efficient for Comcast, as well as a very efficient way for LMI to redeem a substantial block of its outstanding shares.”

Malone added that although he has discussed the matter with Comcast, there is no deal yet. The Adelphia transaction is not expected to be closed for another nine to 12 months.

“I have been encouraging [Comcast chairman and CEO] Brian [Roberts] to bargain for San Juan if there is bargaining room for them,” Malone said on the call.

Comcast declined comment.

Adelphia spokesman Paul Jacobson said that while that company has tried to sell its Puerto Rico systems in the past, no deal is imminent.

“We’re still in the process of trying to determine what to do with them,” he added. “We’ve been looking for ways to resolve the situation down there in terms of how to work with that asset. We’re looking for opportunities to possibly sell it, but so far, we’ve had nothing to report on that publicly, although the efforts have been under way.”

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