UnitedGlobalCom Makes Major Broadband Deal with Liberty

[London, ENGLAND] UnitedGlobalCom
has signed a major broadband deal with Liberty Media Corporation
that brings Liberty’s European and Latin American broadband assets
to United for a combination of cash and shares.

United is paying $200 million cash and 75.3 million Class B
shares for the broadband interests, among which is a 25 percent
stake in U.K. cable operator Telewest Communications plc
which now goes to United’s subsidiary UPC. As a result,
United’s stake in UPC goes up from 51 to 61 percent.

Among a rich and varied bag of Latin American interests
transferred to United in the deal are a 28 percent stake
in Cablevision S.A. of Argentina, 100 percent of regional
programming distributor Pramer, 40 percent of sports
program maker Torneos y Competencias, and the Latin American
operations of the Gems Network.

In addition, United gets other distribution assets, including
49 percent of Puerto Rico-based Liberty Cablevision,
41 percent of Mexican wireless broadband provider
Grupo Portatel, and 43 percent of Digital Latin America —
the Motorola, Hicks Muse joint venture to build a digital
satellite distribution platform.

The deal brings even more of Liberty’s broadband interests
to United with a 15 percent stake in Crown Media Holdings,
distributor of Odyssey and the Hallmark Channel, and
20 percent of Australia’s Premium Movie Partnership.

With its substantial new shareholding in United, Liberty will
appoint four out of 12 representatives to the United board.

Gene Schneider, chairman and chief executive of United,
said the whole transaction achieved his company’s
objectives by expanding UPC’s footprint to include the
U.K. broadband market while significantly increasing
United’s presence in Latin America.

Liberty’s President Robert Bennett said the goal had
always been the attainment of scale in the business of
broadband distribution.

“With scale, broadband distribution assets can be very
attractive in their own right and they also can serve as
a platform for the creation of content assets. This transaction
is a unique opportunity for us to greatly expand the scale
of UGC’s operations and to become the largest shareholder
of that dynamic company,” said Bennett.

United’s Schneider described the U.K. as being Europe’s
most advanced broadband market, one in which Telewest
is the leading integrated broadband communications company.

Recently, Telewest acquired content provider Flextech plc, the
BBC’s commercial pay TV partner.

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