Cable television systems in Inglewood and Carson serving about 11,400 subscribers are being sold to American Cablesystems of California Inc. as part of a three-system, $22-million package.
Approval by the city councils is needed before the deal can go through. Administrators in both cities said they favor approval.
The third system involved in the sale serves 5,400 subscribers in Pomona, where city officials are still reviewing the terms of the sale and studying the operations of American Cablesystems.
American Cablesystems of California is a wholly owned subsidiary of American Cablesystems Corp., based in Beverly, Mass. The company serves 300,000 subscribers in California, New York, Illinois, Massachusetts and Florida and is negotiating to buy cable television franchises in Covina and elsewhere in the Los Angeles area.
The seller is Denver-based Tele-Communications Inc. (TCI), the largest cable company in the nation. TCI has 4 million subscribers in about 400 cable systems across the country, but little presence in Southern California.
Bram Goodwin, TCI area manager, said the sale suits the overall marketing strategies of both firms and is in keeping with an industrywide trend toward “clusters of systems.”
“TCI only had three systems here,” Goodwin said. “We want to be in other parts of the country where we have more systems. American Cablesystems started a base out here, so for them it’s a nice fit.” TCI has been concentrating its efforts in the Pittsburgh area and in the Pacific Northwest, he said.
George Douglas, senior vice president for marketing and programming for American Cablesystems, said U.S. Securities and Exchange Commission rules prohibit the parent company from commenting on the deal because it is in the process of making a new stock offering to the public.
A stock prospectus for American Cablesystems, however, provided some information on the proposed sale, saying: “American expects to consummate acquisition of the TCI system during the summer of 1986 for approximately $22 million.”
The sale will not affect subscribers, Goodwin said, adding that no rate increases are planned.
The 6,000 TCI subscribers in Carson pay an average of $30 a month. TCI’s 5,400 Inglewood subscribers pay $24 a month on the average.
In Inglewood, Deputy City Manager Norman Cravens said he is recommending that the City Council extend the 20-year cable franchise with the city, scheduled to run out in 1992, by another 20 years at American Cablesystems’ request.
American Cablesystems “looks like a very good operating company,” he said.
In Carson, TCI owns part of Carson Cable Television, a joint venture with Camden Communications Inc. of Connecticut. The interests of both partners will be acquired by American Cablesystems, according to Carson Cable manager Pamela Smith.
Scheduled to Expire
American Cablesystems would take over the existing 10-year Carson franchise, which is scheduled to expire in 1989 but can be extended for another 15 years, according to Carson city revenue manager Ferrell Sneed.
“American Cablesystems--from the cities we have been able to check with--is one of the best operated . . . in the country. They are people-oriented. They do try to live up to whatever their agreements are,” Sneed said.
On April 1, American Cablesystems paid $11.5 million for the 11,000-subscriber Jack Barry Cable TV system, which served Baldwin Hills, Playa del Rey, Ladera Heights, Lennox, Westchester and Windsor Hills.