SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) of the
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 7, 1999
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COMCAST CABLE COMMUNICATIONS, INC.
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(Exact name of registrant as specified in its charter)
Delaware 333-30745 23-2175755
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(State or other (Commission file (IRS employer
jurisdiction of number) identification
incorporation) no.)
1500 Market Street, Philadelphia, PA 19102-2148
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (215) 665-1700
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Item 5. Other Events
On April 7, 1999, Comcast Corporation ("Comcast") acquired a controlling
interest in Jones Intercable, Inc. ("Jones Intercable") for aggregate
consideration of $706.3 million in cash. In connection with the acquisition,
Comcast assumed $1.499 billion of debt. Also on that date, Comcast contributed
its interest in Jones Intercable to Comcast Cable Communications, Inc. (the
"Company"). On June 30, 1999, Comcast acquired an additional 1.0 million shares
of Jones Intercable Class A Common Stock for $50.0 million in cash in a private
transaction and contributed such shares to the Company. On March 2, 2000,
Comcast acquired the remaining approximate 60% interest in Jones Intercable that
was owned by the Jones Intercable public shareholders and the approximate 40%
interest in Jones Intercable that was held by the Company. Also on that date,
Jones Intercable was merged with and into Comcast JOIN Holdings, Inc., a wholly
owned subsidiary of Comcast ("JOIN Holdings") with JOIN Holdings as the
successor to Jones Intercable. In connection with the closing of the merger,
Comcast issued approximately 35.6 million shares of its Class A Special Common
Stock with a value of $1.727 billion to the public shareholders for their
approximate 60% interest in Jones Intercable. The acquisitions of Jones
Intercable by Comcast were accounted for under the purchase method of
accounting.
On January 18, 2000, Comcast acquired substantially all of the assets of
Lenfest Communications, Inc. ("Lenfest") for approximately 121.4 million shares
of its Class A Special Common Stock, subject to adjustment, with a value of
$6.077 billion (the "Lenfest Acquisition"). In connection with the Lenfest
Acquisition, Comcast assumed approximately $1.326 billion of debt. Immediately
upon closing of the Lenfest Acquisition, Lenfest was merged with and into
Comcast LCI Holdings, Inc., a wholly owned subsidiary of Comcast ("LCI
Holdings") with LCI Holdings as the successor to Lenfest. The acquisition of
Lenfest by Comcast was accounted for under the purchase method of accounting.
On August 1, 2000, Comcast completed the merger of LCI Holdings and JOIN
Holdings into the Company with the Company as the successor to LCI Holdings and
JOIN Holdings (the "Reorganization"). The Reorganization will be accounted for
at Comcast's historical cost in a manner similar to a pooling of interests.
Accordingly, the Company's consolidated financial statements will include the
accounts of the merged subsidiaries since the dates of their acquisition by
Comcast.
Comcast intends to contribute its 50% interest in Comcast Cablevision of
Garden State, LP ("Garden State Cable") to the Company and merge its subsidiary,
Comcast Cablevision of Philadelphia Area I, Inc. ("Greater Philadelphia") with
and into the Company (together, the "Pending Transactions"). The Pending
Transactions are expected to close by December 31, 2000, subject to receipt of
regulatory approvals. Garden State Cable was a partnership which was owned 50%
by Lenfest and 50% by Comcast. As a result of the Lenfest Acquisition, Comcast
indirectly owns 100% of Garden State Cable. Garden State Cable will be a
consolidated subsidiary of the Company upon Comcast's contribution of its 50%
interest in Garden State Cable to the Company. Greater Philadelphia was acquired
by Comcast on June 30, 1999 for approximately 8.5 million shares of Comcast
Class A Special Common Stock with a value of $291.7 million. Upon closing, the
Pending Transactions will be accounted for at Comcast's historical cost in a
manner similar to a pooling of interests and the Company's consolidated
financial statements will include the results of Garden State Cable and Greater
Philadelphia since the dates of their acquisition by Comcast.
The unaudited pro forma condensed consolidated financial statements of the
Company are included in this Current Report on Form 8-K under Item 7 and are
listed in the index to unaudited pro forma financial information.
2
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
The unaudited pro forma condensed consolidated financial statements of
Comcast Cable Communications, Inc. are included in this Current Report on Form
8-K and are listed in the index to unaudited pro forma financial information.
EXHIBIT NO.
10.1 Agreement and Plan of Merger, dated as of July 28, 2000, by and among
Comcast Cable Communications, Inc., Comcast LCI Holdings, Inc., formerly
a wholly owned subsidiary of Comcast Corporation ("Comcast") and Comcast
JOIN Holdings, Inc., formerly a wholly owned subsidiary of Comcast.
3
SIGNATURE
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Dated: September 27, 2000 COMCAST CABLE COMMUNICATIONS, INC.
By: /s/ Lawrence J. Salva
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Lawrence J. Salva
Senior Vice President
(Principal Accounting Officer)
4
EXHIBIT INDEX
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10.1 Agreement and Plan of Merger, dated as of July 28, 2000, by and among
Comcast Cable Communications, Inc., Comcast LCI Holdings, Inc., formerly
a wholly owned subsidiary of Comcast Corporation ("Comcast") and Comcast
JOIN Holdings, Inc., formerly a wholly owned subsidiary of Comcast.
5
COMCAST CABLE COMMUNICATIONS, INC.
INDEX TO UNAUDITED PRO FORMA FINANCIAL INFORMATION
Unaudited Pro Forma Financial Information F - 1
Unaudited Pro Forma Condensed Consolidated
Balance Sheet as of June 30, 2000 F - 3
Unaudited Pro Forma Condensed Consolidated Statement
of Operations for the Six Months Ended June 30, 2000 F - 4
Unaudited Pro Forma Condensed Consolidated Statement
of Operations for the Year Ended December 31, 1999 F - 5
Notes to Unaudited Pro Forma Condensed Consolidated
Financial Statements F - 6
UNAUDITED PRO FORMA
FINANCIAL INFORMATION
Reorganization
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On April 7, 1999, Comcast Corporation ("Comcast") acquired a controlling
interest in Jones Intercable, Inc. ("Jones Intercable") for aggregate
consideration of $706.3 million in cash. In connection with the acquisition,
Comcast assumed $1.499 billion of debt. Also on that date, Comcast contributed
its interest in Jones Intercable to Comcast Cable Communications, Inc. (the
"Company"). On June 30, 1999, Comcast acquired an additional 1.0 million shares
of Jones Intercable Class A Common Stock for $50.0 million in cash in a private
transaction and contributed such shares to the Company. On March 2, 2000,
Comcast acquired the remaining approximate 60% interest in Jones Intercable that
was owned by the Jones Intercable public shareholders and the approximate 40%
interest in Jones Intercable that was held by the Company. Also on that date,
Jones Intercable was merged with and into Comcast JOIN Holdings, Inc., a wholly
owned subsidiary of Comcast ("JOIN Holdings") with JOIN Holdings as the
successor to Jones Intercable. In connection with the closing of the merger,
Comcast issued approximately 35.6 million shares of its Class A Special Common
Stock with a value of $1.727 billion to the public shareholders for their
approximate 60% interest in Jones Intercable. The acquisitions of Jones
Intercable by Comcast were accounted for under the purchase method of
accounting.
On January 18, 2000, Comcast acquired substantially all of the assets of Lenfest
Communications, Inc. ("Lenfest") for approximately 121.4 million shares of its
Class A Special Common Stock, subject to adjustment, with a value of $6.077
billion (the "Lenfest Acquisition"). In connection with the Lenfest Acquisition,
Comcast assumed approximately $1.326 billion of debt. Immediately upon closing
of the Lenfest Acquisition, Lenfest was merged with and into Comcast LCI
Holdings, Inc., a wholly owned subsidiary of Comcast ("LCI Holdings") with LCI
Holdings as the successor to Lenfest.
On August 1, 2000, Comcast completed the merger of LCI Holdings and JOIN
Holdings into the Company with the Company as the successor to LCI Holdings and
JOIN Holdings (the "Reorganization"). The Reorganization will be accounted for
at Comcast's historical cost in a manner similar to a pooling of interests.
Accordingly, the Company's consolidated financial statements will include the
accounts of the merged subsidiaries since the dates of their acquisition by
Comcast.
Pending Transactions
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Comcast intends to contribute its 50% interest in Comcast Cablevision of Garden
State, LP ("Garden State Cable") to the Company and merge its subsidiary,
Comcast Cablevision of Philadelphia Area I, Inc. ("Greater Philadelphia") with
and into the Company (together, the "Pending Transactions"). The Pending
Transactions are expected to close by December 31, 2000, subject to receipt of
regulatory approvals. Garden State Cable was a partnership which was owned 50%
by Lenfest and 50% by Comcast. As a result of the Lenfest Acquisition, Comcast
indirectly owns 100% of Garden State Cable. Garden State Cable will be a
consolidated subsidiary of the Company upon Comcast's contribution of its 50%
interest in Garden State Cable to the Company. Greater Philadelphia was acquired
by Comcast on June 30, 1999 for approximately 8.5 million shares of Comcast
Class A Special Common Stock with a value of $291.7 million. Upon closing, the
Pending Transactions will be accounted for at Comcast's historical cost in a
manner similar to a pooling of interests and the Company's consolidated
financial statements will include the results of Garden State Cable and Greater
Philadelphia since the dates of their acquisition by Comcast.
F-1
Subsequent Events
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Effective August 1, 2000, Comcast assigned its intercompany management and
programming agreements with the Company's subsidiaries and with certain of
Comcast's other cable communications subsidiaries to the Company. As such,
effective August 1, 2000, amounts charged by the Company to the Company's
subsidiaries for management fees and programming will be eliminated in the
Company's consolidated financial statements.
On August 1, 2000, Comcast completed its acquisition of Prime Communications,
LLC ("Prime"), a cable communications company serving approximately 430,000
subscribers, for aggregate consideration of approximately $1.4 billion. Comcast
will account for the acquisition under the purchase method of accounting.
Comcast contributed its interest in Prime to the Company on that date. As such,
effective August 1, 2000, the Company's consolidated financial statements will
include the results of Prime.
In August 2000, subsequent to the Reorganization, the Company replaced all of
its subsidiaries' existing credit facilities and certain of Comcast's other
cable communications subsidiaries' existing credit facilities with the Company's
new bank credit facility and new commercial paper program. The Company's new
bank credit facility consists of a $2.25 billion, five-year senior credit
facility and a $2.25 billion, 364-day revolving credit facility. The 364-day
revolving credit facility supports the Company's new commercial paper program.
In August 2000, the Company borrowed $1.4 billion under the five-year facility
and $1.0 billion under the commercial paper program, the proceeds of which were
used to repay and retire approximately $2.4 billion of Comcast's subsidiaries'
credit facilities, including $2.1 billion of the Company's subsidiaries' credit
facilities and Garden State Cable's $0.3 billion credit facility.
Basis of Presentation
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The unaudited pro forma information set forth below for the Company gives effect
to the Reorganization and the Pending Transactions since the dates of
acquisition by Comcast of the subsidiaries for purposes of the condensed
consolidated statement of operations for the year ended December 31, 1999, the
condensed consolidated statement of operations for the six months ended June 30,
2000 and the condensed consolidated balance sheet as of June 30, 2000.
The unaudited pro forma information set forth below for the Company excludes the
effects of the subsequent events described above.
This pro forma financial information should be read in conjunction with the
historical consolidated financial statements of the Company.
F-2
Comcast Cable Communications, Inc.
Pro Forma Condensed Consolidated Balance Sheet (Unaudited)
As of June 30, 2000
(Dollars in millions, except share data)
Historical Comcast Comcast Comcast
Comcast JOIN LCI Pending Cable
Cable(1) Holdings(1)(2) Holdings(3) Subtotal Transactions(4) Pro Forma
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ASSETS
CURRENT ASSETS
Cash and cash equivalents $40.5 $7.9 $13.9 $62.3 $0.7 $63.0
Investments 53.2 1.7 54.9 54.9
Accounts receivable, less allowance
for doubtful accounts 96.4 21.1 53.3 170.8 2.8 173.6
Deferred income tax benefit, due from
affiliate 24.5 24.5 24.5
Other current assets 25.1 7.5 5.2 37.8 5.0 42.8
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Total current assets 239.7 38.2 72.4 350.3 8.5 358.8
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INVESTMENTS 27.9 52.9 797.5 878.3 (536.9) 341.4
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PROPERTY AND EQUIPMENT 3,751.9 475.1 1,130.9 5,357.9 287.5 5,645.4
Accumulated depreciation (1,445.4) (4.1) (20.9) (1,470.4) (72.5) (1,542.9)
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Property and equipment, net 2,306.5 471.0 1,110.0 3,887.5 215.0 4,102.5
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DEFERRED CHARGES 6,829.7 4,609.5 6,977.4 18,416.6 1,960.9 20,377.5
Accumulated amortization (2,018.8) (241.7) (290.6) (2,551.1) (227.1) (2,778.2)
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Deferred charges, net 4,810.9 4,367.8 6,686.8 15,865.5 1,733.8 17,599.3
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$7,385.0 $4,929.9 $8,666.7 $20,981.6 $1,420.4 $22,402.0
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LIABILITIES AND STOCKHOLDER'S EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses $291.8 $109.0 $99.9 $500.7 $70.1 $570.8
Accrued interest 32.1 16.1 20.1 68.3 0.4 68.7
Current portion of long-term debt 0.1 2.5 1.1 3.7 20.5 24.2
Due to affiliates 125.1 53.1 246.3 424.5 (68.8) 355.7
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Total current liabilities 449.1 180.7 367.4 997.2 22.2 1,019.4
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LONG-TERM DEBT, less current portion 3,062.9 1,591.4 1,318.4 5,972.7 265.5 6,238.2
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MINORITY INTEREST AND OTHER 127.4 30.7 5.9 164.0 164.0
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DEFERRED INCOME TAXES, due to affiliate 1,553.4 762.4 1,915.0 4,230.8 96.2 4,327.0
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COMMITMENTS AND CONTINGENCIES
STOCKHOLDER'S EQUITY
Common stock, $1 par value - authorized
and issued, 1,000 shares
Additional capital 5,460.5 2,489.4 5,292.4 13,242.3 1,076.6 14,318.9
Accumulated deficit (3,245.5) (122.0) (212.6) (3,580.1) (40.1) (3,620.2)
Accumulated other comprehensive loss (22.8) (2.7) (19.8) (45.3) (45.3)
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Total stockholder's equity 2,192.2 2,364.7 5,060.0 9,616.9 1,036.5 10,653.4
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$7,385.0 $4,929.9 $8,666.7 $20,981.6 $1,420.4 $22,402.0
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See notes to unaudited pro forma condensed consolidated financial statements.
F-3
Comcast Cable Communications, Inc.
Pro Forma Condensed Consolidated Statement of Operations (Unaudited)
Six Months Ended June 30, 2000
(Dollars in millions)
Historical Comcast Comcast Comcast
Comcast JOIN LCI Pending Cable
Cable(1) Holdings(1) Holdings Subtotal Transactions(4) Pro Forma
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SERVICE INCOME $1,436.5 $196.0 $276.8 $1,909.3 $92.2 $2,001.5
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COSTS AND EXPENSES
Operating 647.4 82.9 115.3 845.6 27.5 873.1
Selling, general and administrative 324.2 53.5 66.5 444.2 18.5 462.7
Depreciation and amortization 465.9 194.6 324.5 985.0 99.2 1,084.2
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1,437.5 331.0 506.3 2,274.8 145.2 2,420.0
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OPERATING LOSS (1.0) (135.0) (229.5) (365.5) (53.0) (418.5)
OTHER (INCOME) EXPENSE
Interest expense 140.6 41.2 59.1 240.9 9.3 250.2
Investment (income) expense and other,
net (33.6) 0.3 1.7 (31.6) 0.4 (31.2)
Equity in net losses of affiliates 7.5 7.5 (7.5)
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107.0 41.5 68.3 216.8 2.2 219.0
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LOSS BEFORE INCOME TAX BENEFIT
AND EXTRAORDINARY ITEMS (108.0) (176.5) (297.8) (582.3) (55.2) (637.5)
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INCOME TAX BENEFIT 12.6 58.6 86.2 157.4 18.3 175.7
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LOSS BEFORE EXTRAORDINARY ITEMS (95.4) (117.9) (211.6) (424.9) (36.9) (461.8)
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See notes to unaudited pro forma condensed consolidated financial statements.
F-4
Comcast Cable Communications, Inc.
Pro Forma Condensed Consolidated Statement of Operations (Unaudited)
Year Ended December 31, 1999
(Dollars in millions)
Historical Comcast
Comcast Pending Cable
Cable(1) Transactions(4) Pro Forma
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SERVICE INCOME $2,906.5 $22.9 $2,929.4
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COSTS AND EXPENSES
Operating 1,242.4 10.1 1,252.5
Selling, general and administrative 685.3 6.1 691.4
Depreciation and amortization 1,017.7 9.9 1,027.6
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2,945.4 26.1 2,971.5
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OPERATING LOSS (38.9) (3.2) (42.1)
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OTHER (INCOME) EXPENSE
Interest expense 352.9 352.9
Interest expense on notes payable
to affiliates 10.0 10.0
Investment income (6.8) (6.8)
Other expense 6.6 6.6
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362.7 362.7
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LOSS BEFORE INCOME TAX BENEFIT, MINORITY
INTEREST AND EXTRAORDINARY ITEMS (401.6) (3.2) (404.8)
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INCOME TAX BENEFIT 46.2 46.2
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LOSS BEFORE MINORITY INTEREST
AND EXTRAORDINARY ITEMS (355.4) (3.2) (358.6)
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MINORITY INTEREST INCOME 107.9 107.9
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LOSS BEFORE EXTRAORDINARY ITEMS (247.5) (3.2) (250.7)
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See notes to unaudited pro forma condensed consolidated financial statements.
F-5
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Historical Comcast Cable includes the results of Jones Intercable prior to
March 2, 2000. Effective March 2, 2000, upon completion of the merger of
Jones Intercable with and into JOIN Holdings, the results of JOIN Holdings
are presented seperately in the accompanying unaudited pro forma financial
information.
2. Comcast adjusted the purchase price allocation relating to Comcast's
acquisition of the public shareholders' interest in Jones Intercable during
the second quarter of 2000. The Company has obtained a preliminary
appraisal of fair value of certain of JOIN Holdings' assets and liabilities
and will make final purchase accounting adjustments upon completion of the
final appraisal.
3. A final determination of required purchase accounting adjustments relating
to the Lenfest Acquisition, including the allocation of the purchase price
to the assets acquired and liabilities assumed based on their respective
fair values, has not yet been made. Accordingly, the purchase accounting
adjustments relating to the Lenfest Acquisition included in the unaudited
pro forma financial information are preliminary. The Company is in the
process of obtaining an independent appraisal of the fair value of certain
of LCI Holdings' assets and liabilities and will make final purchase
accounting adjustments upon completion of the appraisal.
4. Pending Transactions includes the results of Garden State Cable and Greater
Philadelphia. Pending Transactions also includes an adjustment to reverse
LCI Holdings' equity method accounting for Garden State Cable. The Pending
Transactions will be accounted for at Comcast's historical cost in a manner
similar to a pooling of interests. As such, Comcast Cable pro forma
includes the results of Garden State Cable and Greater Philadelphia since
the dates of their acquisition by Comcast.
F-6