FTC Clears Cable Giants’ Deal to Buy Adelphia

U.S. antitrust authorities said Tuesday that they had approved plans by Time Warner Inc. and Comcast Corp. to buy cable operator Adelphia Communications Corp.

The Federal Trade Commission said its bureau of competition had closed its seven-month investigation into the deal without taking action.

In April, Adelphia accepted a buyout offer from Time Warner and Comcast valued at an estimated $17.6 billion in cash and stock.

The FTC’s five commissioners did not vote on the matter. But in a statement, three commissioners, including Chairwoman Deborah Majoras, said they agreed with staffers in the competition bureau.

“The evidence obtained during the investigation does not suggest that the proposed transactions are likely to substantially lessen competition in any geographic region in the United States,” the three commissioners said in the statement.

The remaining two commissioners said they agreed partially, but they also expressed “serious concerns” that the companies could raise the price of sports programming for some rivals.

Adelphia collapsed into bankruptcy protection in 2002 after the company’s founding Rigas family siphoned off millions of dollars for personal use and overstated key financial results.

The deal will cement Time Warner’s position as the No. 2 U.S. cable operator as it gains a stronghold in the lucrative Los Angeles market that could boost growth.

Comcast is the No. 1 U.S. cable operator. The deal will unwind its 21% stake in Time Warner Cable and Time Warner Entertainment.