AT&T Sells Cable Systems to Cox in South, West

In a stock swap and cash deal worth almost $3 billion, Atlanta-based Cox Communications Inc. announced today that it will acquire cable television systems serving approximately 495,000 customers in states in the South and West US.

In return for its 50.3 million shares of AT&T stock, Cox will receive:

• The AT&T Broadband & Internet Services (AT&T BIS) cable systems serving Tulsa, Oklahoma (160,000 customers) and Baton Rouge, Louisiana (156,000 customers)
• AT&T BIS's 20% ownership in a partnership with TCA Cable TV, representing 62,000 attributable customers in Texas, Louisiana and New Mexico. In a separate transaction announced in May, Cox is acquiring TCA in a transaction valued at approximately $4 billion.
• Peak Cablevision, which is currently owned by AT&T BIS and the Fisher family and has 117,000 customers in Oklahoma, Arkansas, Utah and Nevada
• Approximately $750 million in other consideration, including cash

Based on Tuesday's closing price of AT&T's stock, the transaction is valued at approximately $2.8 billion, or $4,230 per subscriber. The agreement has been approved by the boards of AT&T and Cox Communications, and will be subject to necessary government and regulatory approvals. Closing, which is expected by Q1 2000, is conditioned upon the ability of Cox and AT&T to qualify the transaction as a tax-free reorganization. The transaction is not connected to an agreement on the provision of local telephone service.

Following the close of pending cable system acquisitions, Cox will serve approximately 5.5 million customers nationwide, making it the nation's fifth largest cable company.