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EXHIBIT 99.1
UnitedGlobalCom, Inc. (ticker: UCOMA, exchange: NASDAQ) News Release - Monday,
June 26, 2000
UNITEDGLOBALCOM AND LIBERTY MEDIA AGREE TO COMBINE INTERNATIONAL BROADBAND
ASSETS
DENVER, June 26 /PRNewswire/ -- UnitedGlobalCom, Inc. ("United") (Nasdaq:
UCOMA), the largest broadband communications provider of video, voice and data
services outside the U.S., and Liberty Media Corporation ("Liberty") (NYSE:
LMG.A, LMG.B), which holds interests in a broad range of video programming,
communications, technology and Internet businesses throughout the world, today
announced an agreement that will significantly strengthen the relationship
between the two companies by strategically combining many of their broadband
interests outside the U.S.
The agreement calls for United to acquire certain of Liberty's international
broadband distribution and programming assets in exchange for $200 million in
cash and 75.3 million shares of United's Class B common stock. These shares
represent a 38% economic and a 72% voting interest in the company.
Liberty will be bound by voting and standstill agreements with United and
certain of its controlling shareholders, and will have the right to appoint four
out of 12 representatives to the United board.
The Liberty assets to be acquired include:
o A 25% indirect, economic interest in Telewest Communications plc (London:
TWT; Nasdaq: TWSTY), the second largest broadband communications provider
in the United Kingdom with approximately 4.7 million homes passed, 1.2
million cable television subscribers, and 1.7 million fixed telephony
subscribers. Liberty will transfer to United 99% of a limited liability
company (LLC) which holds 724.3 million ordinary shares of Telewest. The
remaining 1% of the LLC and sole management power over the LLC will be held
by Liberty. United will obtain a right of first refusal over the transfer
of these interests.
o Liberty's Latin American broadband interests including:
- A 28% stake (with a right to increase to 50%) in Cablevision S.A. of
Argentina, the largest cable television operation in Latin America
with over 3.4 million homes passed and 1.5 million subscribers.
- Regional programming services including: 100% of Pramer SCA, which
owns and/or distributes 18 channels principally to the Argentine
market; a 40% stake in Torneos y Competencias S.A., the leading
provider of sports and entertainment programming in Argentina; and the
Latin American operations of the Gems Network;
- Other distribution assets, including: 49% of Liberty Cablevision of
Puerto Rico; 41% of Grupo Portatel, a wireless broadband service
provider in Mexico; and 43% of Digital Latin America, a joint venture
with Hicks Muse and Motorola to build a digital satellite distribution
platform for the region.
o Certain other broadband interests held by Liberty, including a 15% stake in
Crown Media Holdings, Inc., distributor of Odyssey and the Hallmark
Channel; and 20% of Premium Movie Partnership, a movie channel joint
venture in Australia.
o In addition, United will be granted rights of first offer, subject to
existing rights of third parties, with respect to Liberty's programming and
distribution assets in Japan, as well as rights of first offer and certain
other rights with respect to Liberty's broadband interests in other
markets.
United will contribute the indirect interest in Telewest to its subsidiary
United Pan-Europe Communications ("UPC") (Amsterdam: UPC; Nasdaq: UPCOY) in
exchange for 128.2 million UPC shares, which will increase UnitedGlobalCom's
ownership in UPC to approximately 61%.
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Gene Schneider, Chairman and CEO of United, said, "Simply put, this transaction
achieves our most important strategic objectives. Specifically, it:
o expands UPC's footprint to include the U.K., Europe's most advanced
broadband market;
o increases United's ownership in UPC to 61%;
o strengthens our relationship with Liberty, one of the world's most
successful media and communications companies;
o significantly increases our presence in Latin America;
o represents a transaction share price which more closely reflects the
underlying value of our businesses than the current share price; and,
o keeps control of United in the hands of its founders;
I couldn't be more pleased with this deal and look forward to an even broader
relationship with John Malone and the Liberty team."
John Malone, Chairman of Liberty Media, said: "I have known Gene Schneider for
over 30 years and have tremendous respect for the management team and strategic
vision that he has developed in the international broadband arena. It is in
large part due to our confidence in United's strategy, and the value creation
opportunity associated with this strategy, that we at Liberty have chosen to
enter into this important strategic relationship."
Mike Fries, President and COO of United, said, "Over the last six months we have
made clear our plans to create a Latin American broadband platform, similar to
our successful operations in Europe and Australia. With the acquisition of
Liberty's distribution and programming interests in the region, we will be the
largest operator with interests in over 5.8 homes passed and 2.2 million
subscribers and a range of valuable programming businesses. It is our intention
to consolidate these interests, potentially with existing partners and other
operators, into a regional holding company which could seek a public listing in
the months ahead."
Robert Bennett, President and CEO of Liberty, said, "We have often stated
Liberty's goal of creating scale in the business of broadband distribution. With
scale, broadband distribution assets can be very attractive in their own right
and they also can serve as a platform for the creation of content assets. This
transaction is a unique opportunity for us to greatly expand the scale of UGC's
operations and to become the largest shareholder of that dynamic company."
Mark Schneider, CEO of UPC, said: "We are extremely pleased to have secured such
an important economic stake in Telewest, a key player in the highly attractive
U.K. broadband market. We also look forward to working with Telewest management
to explore broader strategic relationships between our two companies."
Closing of the transaction is subject to certain regulatory, shareholder and
third party approvals which the parties expect to complete early in the fourth
quarter.
Donaldson, Lufkin & Jenrette and Morgan Stanley Dean Witter advised United on
this transaction.
CS First Boston assisted Liberty on this transaction.
About UnitedGlobalCom:
UnitedGlobalCom is the largest broadband communications provider of video, voice
and data services outside the U.S. With operations in 26 countries,
UnitedGlobalCom's networks reach nearly 26 million homes and businesses and
serve more than 12.8 million video customers and 2 million telephony access
lines, including announced transactions. In addition, its high speed Internet
access business has more than 200,000 accounts. UnitedGlobalCom's significant
operating subsidiaries include United Pan-Europe Communications N.V. (UPC) (51%
owned), the largest pan-European broadband communications company; Austar United
Communications (72% owned) the fastest growing satellite, cable television and
telecommunications provider in Australia and New Zealand; and VTR GlobalCom
(100% owned), the largest cable television and competitive telephony provider in
Chile.
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About Liberty Media:
Liberty Media holds interests in a broad range of video programming,
communications, technology and Internet businesses in the United States, Europe,
South America and Asia.
About UPC:
Headquartered in Amsterdam, UPC is one of the most innovative broadband
communications companies in Europe and owns and operates the largest
pan-European group of broadband communication networks. UPC provides cable
television, telephony, high-speed Internet access and programming services in
eighteen countries across Europe and in Israel. As of March 31, 2000, on an
aggregate basis (pro-forma for announced acquisitions), UPC's footprint reached
15.8 million franchised homes and 12.9 million homes passed with approximately
8.4 million basic cable subscribers. In addition, UPC systems had 271,400
residential telephony lines and 22,500 business telephony lines as well as
176,800 residential Internet subscribers and 4,300 business Internet
subscribers.
UPC is a consolidated subsidiary of Denver based UnitedGlobalCom Inc. ("United")
(Nasdaq: "UCOMA") and Microsoft has an interest of approximately 8.0% in UPC.
UPC shares are traded on the Amsterdam Stock Exchange ("UPC") and Nasdaq
("UPCOY").
About Telewest:
Telewest is Britain's leading integrated broadband communications company.
Telewest's broadband cable networks now pass more than 4.7 million homes, with
more than 1.6 million households choosing Telewest for their multi-channel
television, telephone and Internet services. In the business sector, Telewest's
voice and data communications links are used by over 58,000 companies and other
public and private sector organizations. Telewest recently acquired 100% of
Flextech plc which is a major supplier of video channels, Internet content and
interactive TV to cable, satellite and digital terrestrial platforms in the UK.
Flextech is the BBC's commercial pay TV partner and also provides management
services to Discovery UK.
NOTE:
Senior management from United, UPC and Liberty will review the
transactions in a conference call and web cast which will begin at 10:00
a.m. (EDT) Monday. The call can be accessed by dialing 1-888-781-9185
(U.S.) or 1-706-634-0612 (International) and by using the pass code
#834054 at least 10 minutes prior to start time. Replays of the conference
call can be accessed approximately two hours following the call from June
26 to July 3, 2000 by dialing 800-642-1687 (U.S.) or 706-645-9291
(International) and by using the pass code #834054. The web cast will be
available through the "Investor Relations" section of UnitedGlobalCom's
web site located at www.unitedglobal.com.
NOTE:
Except for historical information contained herein, this news release
contains forward looking statements which involve certain risks and
uncertainties that could cause actual results to differ materially from
those expressed or implied by these statements. These forward looking
statements include consummation of planned acquisitions, launch of new
services and other statements concerning growth, as well as other factors
detailed from time to time in the companies' filings with the Securities
and Exchange Commission.
SOURCE UnitedGlobalCom, Inc.
CONTACT: investors: Rick Westerman, CFO, 303-220-6647, fax 303-770-3464,
[email protected], or press, Jim Carlson, Corporate Communications,
303-220-6662, fax 303-770-4207, mobile 303-808-4955, [email protected], both
for UnitedGlobalCom; or Vivian Carr, VP Investor Relations of Liberty Media,
877-772-1518, fax 720-875-5445, [email protected]; or Miranda Curtis,
President of Liberty Media International, 44-207-299-5901, fax 44-207-299-5906,
[email protected]/
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