Cellular deal unravelsThree key players in the rapidly...


August 30, 1994

Cellular deal unravels

Three key players in the rapidly expanding field of wireless communications yesterday called off plans to build a cellular telephone network that would have reached about 95 percent of jTC the U.S. population.

Nextel Communications Inc., which provides mobile radio services; long-distance carrier MCI Communications Corp.; and Comcast Corp., a cable TV and cellular phone company, issued a statement saying they broke off plans to provide a nationwide wireless communications system.

Analysts speculated that MCI was unhappy that recent acquisitions of Nextel stock by other firms would have diluted MCI's share of the company from 17 percent to 12 percent.

News of the deal's collapse sent Nextel shares skidding $5.25, to $25.25. MCI was off 37.5 cents, at $24, and Comcast fell 37.5 cents, to $16.50.

Personal income up in July

Americans' incomes rose strongly in July but they held spending in check and saved more, suggesting more moderate economic growth ahead. The report was welcomed by financial markets.

Income from wages, salaries and all other sources (such as rents and dividends) rose 0.5 percent from June to a seasonally adjusted annual rate of $5.69 trillion, the Commerce Department reported yesterday. But spending was up a scant 0.2 percent to a rate of $4.62 trillion.

By contrast, June income rose only 0.1 percent, while spending gained 0.5 percent.

Confederation sale announced

Peat Marwick Thorne Inc., the liquidator for the failed Confederation Life Insurance Co., said yesterday it agreed to sell Confederation Life's Canadian group life and health assets to Manulife Financial.

Confederation Life, in one of the biggest insurance failures ever in North America, was seized earlier this month by federal regulators after a last-minute, $438 million bailout failed to materialize from a consortium of Canadian insurance companies.

Peat Marwick did not disclose terms of the transaction.

Antitrust probe set in N.Y.

Following up on a threat he made after ITT and Cablevision Systems announced they would purchase Madison Square Garden from Viacom Inc., the New York attorney general said yesterday he was opening an antitrust investigation of the deal.

Viacom announced Sunday that ITT Corp. and Cablevision Systems Corp. would pay $1.075 billion for a package that includes the Madison Square Garden arena, the New York Knicks and Rangers, and the MSG Network, which many analysts consider to be the jewel of the properties.

The deal "raises concerns," Attorney General G. Oliver Koppell said. "Cablevision has substantial franchises in the metropolitan New York area, which MSG did not."


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