TIME WARNER PLANS TO SELL STAKE IN E! TO FOUR MSOS: CONJECTURE HAS MEDIA GIANT ALSO UNLOADING ITS COMEDY CENTRAL INTEREST

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Time Warner Entertainment is expected to sell its 58% stake in E! Entertainment Television to the four other cable systems operators that currently hold 10% each of the cable network.

Time Warner has valued the entire network at about $550 million, executives familiar with the situation say, adding that the buyout is expected in the next 30 to 60 days.

COMEDY CENTRAL NEXT?

There's also speculation among cable systems operators and programming executives that Time Warner will consider selling its 50% stake in Comedy Central; Viacom owns the other half of that cable network.

The buy-sell provision of the E! ownership contract was triggered in October by the minority stakeholders-Comcast Corp., Continental Cablevision, Cox Communications and Tele-Communica- tions Inc. (AA, Oct. 28).

Lee Masters, president-CEO of E!, declined to comment on the valuation price, saying only, "We have seen estimates from Wall Street that say the network is worth from $660 million to $750 million, and I think that's what a lot of third parties would pay."

But this is a deal among insiders. And one executive close to the situation said Comcast, whose president, Brian Roberts, is eager to acquire programming assets, is pushing to get it done.

CONTINENTAL A WILD CARD

Mr. Roberts could not be reached for comment, and executives at all of the other companies declined comment.

The one wild card in the deal is Continental, said an insider at one of the partners.

"They are being acquired by U S West, but it's not clear that U S West really wants in on the deal," the insider said.

It is possible Continental's stake could be bought out by one of the three other minority partners.

If for some reason the four minority stakeholders don't buy out Time Warner, terms of the contract call for Time Warner to buy them out at the price it has set.

E! REACHES 42 MILLION HOMES

Part-owner TCI separately said it is dropping E! from about 1 million homes on Jan. 1. But the network has picked up about that number of subscribers from other multiple system operators this month. With about 6.7 million new subscribers this year, E! can be seen in 42 million homes.

Speculation is now turning to Time Warner's ownership of Comedy Central.

"After the E! deal is done, I think Time Warner is going to re-evaluate its position with Comedy Central," said the president of a competing programming service, echoing comments made by other cable executives.

But, said one high-ranking Time Warner executive, "It's not a dysfunctional partnership [with Viacom]. I don't think we will move to dissolve it."

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