Sale of Susquehanna Could Come Soon

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It’s coming down to the wire on the pending sale of Susquehanna Media Corp., with sources saying a decision could be made on selling the cable properties and radio stations as early as this week.

According to sources, bidders for the cable systems — with about 230,000 subscribers in Pennsylvania, New York, Mississippi, Maine, Illinois and Indiana — include a management group headed by former Susquehanna CEO Peter Brubaker, Comcast Corp. and Patriot Media & Communications Inc.

Bidders for the 33 radio stations included Citadel Broadcasting Corp. and Cumulus Media.

Brubaker is said to be backed by private-equity firms Kohlberg Kravis Roberts, Providence Equity Partners and Alta Communications. Patriot is backed by Boston private-equity firm Spectrum Equity Associates.

Susquehanna Media put itself on the block in April as part of a plan by parent Susquehanna Pfaltzgraff to liquidate operations.

“We received bids on Tuesday [Sept. 13] and we are still in the process of negotiations,” Susquehanna Pfaltzgraff chief financial officer John Finlayson said, declining further comment.

Sources familiar with the matter said Susquehanna could decide as early as the end of the month. The cable systems could attract as much as $800 million and the radio stations could bring in $1.2 billion.

Comcast already owns more than 30% of Susquehanna’s cable systems, acquired along with Lenfest Communications Inc. in 2000. A right of first refusal bars Susquehanna from selling the systems without first offering them to Comcast.

Susquehanna also buys the bulk of its programming through Comcast, and has said that if its relationship with the No. 1 U.S. MSO were to end, its programming costs would rise “faster than they would otherwise.”

According to one source familiar with Susquehanna, a Comcast bid could be trumped by a higher offer that Comcast declines to match or by one that is acceptable to Susquehanna and also includes the radio stations.

Susquehanna has been said to favor selling the company as a whole, mainly for tax considerations. That could change if there’s a higher price to be had selling the properties separately.

Brubaker wants the whole company and is possibly willing to pay top dollar for it. But sources said Comcast and Patriot are not out of the running. Comcast is said to be very interested in the properties — they would fill out existing markets as well as areas the cable giant will acquire once its joint acquisition of Adelphia Communications Corp. is completed by the end of the year. Patriot, headed by Steve Simmons, is said to be an “aggressive bidder.”

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