Times Mirror Cable Negotiates to Buy Irvine System : Media: Irvine Co.’s Community Cablevision has 42,000 subscribers. An analyst said such an acquisition might run $88 million or more.

Times Mirror Cable Television Inc. said Wednesday that it is negotiating to buy Community Cablevision, a 42,000-subscriber system owned by the Irvine Co.

The system, which covers all of Irvine and parts of Newport Beach, Tustin, Orange and unincorporated Orange County, would give Times Mirror Cable an even greater stake in an area prized for its growing population of younger families and professionals. Already, the Irvine-based operator covers almost all of South County, where it has nearly 135,000 subscribers.

If the sale goes through, Times Mirror Cable would initially acquire a 20% stake in the cable operation, then buy the remaining 80% after it obtained approvals from local governments. The transaction is expected to be completed within a few weeks.

The cost of the potential acquisition was not disclosed. Given the size of the system and its demographics, the system is likely to be sold for $88 million to $90 million, said Paula Greer, an associate analyst for Paul Kagan Associates, a media research firm based in Carmel.

Times Mirror Cable spokeswoman Susan Ritchie said the system would operate under the name of the Times Mirror Cable subsidiary, Dimension Cable Services. It is too early to say whether the company would raise cable rates, she said. Community Cablevision offers basic cable service to customers for $21.75 a month.

Community Cablevision had planned to upgrade its operation by converting the system to fiber optics. The state-of-the-art technology, the trend in cable systems nationwide, would increase channel capacity, picture quality and reliability of service. The renovation of the system had been a condition of the city of Irvine’s recent renewal of the company’s franchise for an additional 13 years.

Irvine Co., which has owned the system since its inception in 1962, estimated that it would have cost $12 million to upgrade the system. Faced with that price tag, it originally sought Times Mirror as a minority shareholder to help with financing.

Times Mirror, as it has done in its operations elsewhere, would probably use fiber-optic technology to upgrade the system, Ritchie said.

Dimension Cable is one of about half a dozen cable companies operating in Orange County, including Copley/Colony Cable, Cablevision of Orange County and Paragon Cable.

The Irvine Co., a major player in real estate development but a minor player in the cable business, is also facing a competitive environment and increased costs. While Times Mirror is able to negotiate low rates for channels such as HBO and USA Network because it has such a large number of subscribers--1.1 million nationwide--Irvine Co. has only the one system.

“The more subscribers you can lump together, the lower the programming cost you will have to pay per subscriber,” analyst Greer said. Because of increasing competition, she said, the smaller companies “can’t make any money running the system. If it’s a small company trying to make ends meet, it’s really tough.”