Miami Florida-based newspaper publisher Knight-Ridder Inc has signaled its retreat from the cable television market, following the decision to sell its half share of jointly-owned TKR Cable Co, for $420m to partner Tele-Communications Inc – the largest cable operator in the US. Knight-Ridder’s decision comes at a time when the US cable industry is consolidating fast, making it more difficult for smaller players to compete. Its 50% stake in TKR, which served around 350,000 subscribers in New York and New Jersey, was Knight-Ridder’s main cable interest, and the partnership also included 106,000 subscribers, which TKR acquired from Sammons Communications Inc. Knight-Ridder also owns a 15% interest in another Tele-Communications cable venture that operates cable systems in five southern states serving about 908,000 subscribers. Knight-Ridder plans to use the money from the sale to reduce debt and buy back shares, as well as concentrate on its core publishing business by continuing to acquire and invest in modest-sized businesses. Tele- Communications will pay the $420m in cash and shares, and subject to regulatory and franchise approvals, the deal is expected to be completed by the end of next quarter. Once completed, Tele- Communications’s subscriber base will top 14m. Ross Jones, Knight-Ridder’s senior vice-president and chief financial officer, said We have had a long, harmonious and rewarding partnership with Tele-Communications. The value of our cable interests has increased significantly over the years. However, the market is not adequately reflecting that value in the price of our shares, and we have concluded that our shareholders will be best served by our selling our interest to Tele- Communications.
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