TD Securities and Citibank are preparing an approximately $425 million bank deal for Bresnan Communications, backing its acquisition of cable television systems in Montana, Wyoming and Colorado from AT&T Broadband. The purchase was announced in April and was to be for $735 million in cash, but disputes over the value of the cable properties have held up the sale, a banker said. A spokeswoman for Bresnan declined to comment.
The bank deal currently is slated to comprise a $200 million "B" term loan and a $225 million pro-rata piece. The details, however, are still in flux and will depend upon the final purchase price, the banker noted, adding that there is no definite launch date and pricing has not yet been set. Officials at the banks could not be reached for comment.
Bresnan is a broadband communications provider based in White Plains, N.Y., and the systems being acquired from the AT&T division serve about 320,000 basic subscribers. Commenting on the potential asset values of cable, one banker said RCN's sale of its New Jersey cable assets for $245 million to Sprectum Equity Investors is a very positive sign for the sector. "This values each subscriber north of $3,000," he said, explaining this is one of the main metrics to value a cable property.