Exhibit 99.1
COMCAST CORPORATION MEDIAONE GROUP
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NEWS RELEASE
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FOR IMMEDIATE RELEASE
COMCAST AND MEDIAONE ANNOUNCE $60 BILLION MERGER
MEDIAONE SHAREHOLDERS TO RECEIVE 1.1 COMCAST CLASS A
SPECIAL COMMON SHARES PER MEDIAONE SHARE
Creates Leading Broadband Communications Company
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(Philadelphia, PA and Englewood, CO) March 22, 1999 -- Comcast
Corporation (NASDAQ: CMCSK, CMCSA) and MediaOne Group, Inc. (NYSE:UMG) announced
today that the two companies have entered into a merger agreement that combines
the third and fourth largest domestic cable providers to create the world's
leading broadband communications provider. The combined Comcast/MediaOne will,
on a pro forma basis, serve 11 million cable customers with systems that pass
over 18 million homes domestically. On a pro forma basis, the combined company
would have generated over $8 billion in 1998 revenues, EBITDA of approximately
$2.4 billion and will be well positioned to take advantage of the growing and
dynamic broadband communications industry.
The merger agreement calls for each MediaOne shareholder to receive 1.1
shares of Comcast Class A Special Common Stock (CMCSK) for each MediaOne share
it owns, or $80.16 per share based on Comcast's closing stock price of $72.875
on Friday, March 19th. The stock-based consideration represents a premium of
approximately 32% to MediaOne's closing price of $60.75. Upon completion of the
merger, MediaOne shareholders will own approximately 64% of the equity of the
combined company. The merger will be accounted for as a purchase by Comcast and
will be tax-free to MediaOne shareholders. The boards of directors of both
companies have unanimously approved the transaction.
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Mr. Brian L. Roberts, President of Comcast, said, "This is a
breathtaking moment in the history of Comcast. The combination of MediaOne and
Comcast will form a company with the most attractive assets in the industry, a
powerful balance sheet and an unmatched management team. The new company will
have the size and scope to lead the evolving broadband environment. Our cable
properties are geographically complementary and should provide the opportunity
for meaningful revenue enhancement and operating synergies promptly after
closing."
Mr. Charles M. Lillis, President, Chief Executive Officer and Chairman
of MediaOne, commented, "This transaction creates a company with a unique
combination of high growth domestic and international broadband, programming and
telephony businesses. Together, we will be optimally positioned to develop and
provide nationally branded broadband services across our principal business
lines of video, voice and data. Customers will benefit from a broader and
bundled service offering, while shareholders and employees will have the
opportunity to participate in the growth of the combined entity."
The combined company will:
o have a capitalization of almost $97 billion (market value of equity plus
debt and preferred as of March 19, 1999)
o have the best clustered and one of the largest broadband networks in the
U.S. with 8 clusters, each with greater than 500,000 subscribers
o pass over 18 percent of U.S. households with its existing cable
infrastructure
o serve over 11 million domestic cable customers
o hold valuable global telecommunications, programming and Internet interests
o be strong financially, with little net debt
The management team for the new company will be drawn from the
leadership teams of both MediaOne and Comcast. Ralph J. Roberts will remain
Chairman of the combined company and Brian Roberts will remain President. Chuck
Lillis will serve as a Vice Chairman of Comcast and join the Comcast Board of
Directors along with three additional MediaOne designees, bringing the total
number of directors to 14.
The merger agreement is subject to the approvals of MediaOne and
Comcast shareholders as well as approvals from federal and local regulatory
authorities. The companies anticipate that the merger will close by
approximately year-end.
While the merger agreement prohibits MediaOne from soliciting competing
acquisition proposals, it has 45 days to accept a superior proposal, subject to
payment of a fee of $1.5 billion to Comcast.
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Salomon Smith Barney acted as financial advisor and provided a fairness
opinion to Comcast and Lehman Brothers Inc. acted as financial advisor and
provided a fairness opinion to MediaOne. Comcast is being represented by David
Polk & Wardwell and MediaOne is being represented by Weil Gotshal & Manges and
Cadwalader Wickersham & Taft.
Comcast Corporation (www.comcast.com) is principally engaged in the
development, management and operation of broadband cable networks and in the
provision of content through principal ownership of QVC, Comcast-Spectacor and
Comcast SportsNet, a controlling interest in E! Entertainment Television and
through other programming investments. Comcast's Class A Special and Class A
Common Stock are traded on The Nasdaq Stock Market under the symbols CMCSK and
CMCSA, respectively.
MediaOne Group (www.mediaonegroup.com) is one of the world's largest
broadband communications companies, bringing the power of broadband and the
Internet to subscribers in the United States, Europe and Asia. The company also
has interests in some of the fastest-growing wireless communications businesses
outside the U.S. For 1998, the businesses that comprise MediaOne Group produced
$7.1 billion in proportionate revenue.
This press release contains forward looking statements made pursuant to
the "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. You are cautioned that such forward looking statements involve risks and
uncertainties which could significantly affect expected results in the future
from those expressed in any such forward looking statements made by, or on
behalf of the Company. Certain factors that could cause actual results to differ
materially include, without limitation, the effects of legislative and
regulatory changes; the potential for increased competition; technological
changes; the need to generate substantial growth in the subscriber base by
successfully launching, marketing and providing services in identified markets;
pricing pressures which could affect demand for the Company's services; the
Company's ability to expand its distribution; changes in labor, programming,
equipment and capital costs; availability of debt and equity financing; the
Company's continued ability to create or acquire programming and products that
customers will find attractive; future acquisitions, strategic partnerships and
divestitures; general business and economic conditions; and other risks detailed
from time to time in the Company's periodic reports filed with the Securities
and Exchange Commission.
Contacts:
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Comcast: MediaOne:
John Alchin Jane Okun
Senior Vice President and Treasurer Executive Director, Investor Relations
215-981-7503 303-858-3696
Marlene Dooner Steve Lang
Senior Director of Investor Relations Executive Director, Financial & Corporate
215-981-7392 Communications
303-858-3406
Press:
Abernathy MacGregor Frank
Ann Hance/Adam Miller
212-371-5999