REDMOND, Wash., and PHILADELPHIA, June 9, 1997 — Microsoft Corp. and Comcast Corp. today announced that Microsoft will make an investment of $1 billion in Comcast, the nation’s fourth-largest cable television operator and a diversified telecommunications company. The $1 billion cash investment will enhance Comcast’s deployment of high-speed data and video services via its cable delivery network.
“Our vision for connecting the world of PCs and TVs has long included advanced broadband capabilities to deliver video, data and interactivity to the home,”
said Bill Gates, chairman and CEO of Microsoft.
“Comcast’s integrated approach to cable distribution, programming and telecommunications complements that vision of linking PCs and TVs. Today’s announcement will enhance the integration of broadband pipes and content to expand the services offered to consumers.”
Brian L. Roberts, president of Comcast, stated,
“I am pleased to have Microsoft’s participation as we shape and advance the integration of the PC and the TV. Microsoft’s investment is a strong endorsement of Comcast’s vision to use its cable networks as a broadband vehicle to homes, schools and businesses. Comcast’s customers will be the beneficiaries of the innovations that America’s most advanced computer and cable companies can offer. In addition to a significant cash infusion, this investment gives us access to Microsoft’s expertise, which will help us facilitate the deployment of high-bandwidth applications and lead to more sophisticated services.”
“We have a tradition of investing in businesses that are consistent with our technology vision,”
commented Greg Maffei, vice president of corporate development at Microsoft.
“Like Comcast, Microsoft has always believed that increasing network bandwidth is a key to the eventual convergence of the Internet, the PC and the TV. And we believe that Comcast is a very attractive investment as that convergence occurs.”
Gates will work closely with Roberts regarding the strategic and technological direction of Comcast. In addition, Maffei will serve as an observer on the board of directors of Comcast.
Microsoft will purchase 24,642,681 shares of Class A Special Common Stock (CMCSK) for $500 million at $20.29 per share and $500 million of a new issue of Comcast Series B Convertible Preferred Stock. The Comcast Series B Convertible Preferred Stock will have a 5.25 percent pay-in-kind dividend and will be initially convertible into 21,243,691 shares, which equals an initial conversion price of $23.54 per share. The number of shares into which the issue can be converted will not increase due to the pay-in-kind dividend as the conversion price increases proportionately to the amount of accrued dividends. The issue will have a final maturity of 20 years, but may be redeemed at Microsoft’s option or called by Comcast after seven years. The investment is expected to close this month.
Founded in 1975, Microsoft (NASDAQ
) is the worldwide leader in software for personal computers. The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.
Comcast Corp. is principally engaged in the development, management and operation of wired telecommunications, including cable television and telephone services; wireless telecommunications, including cellular, personal communications services and direct-to-home satellite television; and content through principal ownership of QVC, the world’s premier electronic retailer, through C3 (Comcast Content & Communications), through majority ownership of Comcast-Spectator and controlling interest in E! Entertainment and through other programming investments. The Company’s consolidated and affiliated operations serve over 10 million customers worldwide.
Comcast’s Class A and Class A Special Common Stock are traded on the Nasdaq Stock Market under the symbols CMCSA and CMCSK, respectively.
Microsoft is either a registered trademark or a trademark of Microsoft Corp. in the United States and/or other countries.
Note to editors: For more information on Microsoft, please visit the Microsoft Web page at (http://www.microsoft.com/presspass/) on Microsoft’s corporate information pages. For more information on Comcast, please visit the Comcast Web page at (http://www.comcast.com/) .