The deal is likely to help both companies better compete in an industry that is rapidly consolidating.
"The combination creates a first-tier cable operation with approximately 5 million subscribers and enormous potential for the future," Century chief executive Leonard Tow said in a statement. "More than 90 percent of the company's customers will be concentrated in eleven major clusters."
The deal is expected to close sometime during the third calendar quarter of 1999 and is subject to certain customary conditions, including the approval of Century's shareholders and regulatory approvals.
The transaction calls for Adelphia to assume about $1.6 billion in debt. Century's class A common stockholders will receive $9.16 in cash per share and 0.61 shares of Adelphia class A common stock, based on yesterday's closing price of 57.13.
Century's class B common stockholders will receive $11.81 in cash per share and 0.64 shares of Adelphia class A common stock. Following the merger, the former stockholders of Century will own approximately 48.7 million shares of the class A common stock of Adelphia.
"With the acquisition of Century, Adelphia's annual revenues will exceed $2 billion," Adelphia CEO John Rigas said in a statement.
Century's Tow will join Adelphia's board of directors.
Century owns and operates cable television systems in California, Colorado, and Puerto Rico. The company recently entered into an agreement with Tele-Communications Incorporated to create a 70 percent-owned joint venture serving approximately 800,000 subscribers in the Los Angeles area.
Adelphia's current business operations include cable entertainment, local and long distance telephone services, high-speed Internet access, paging, and security.
Just last month, Adelphia agreed to buy FrontierVision Partners for $2.1 billion in cash, stock, and assumed debt to expand in Ohio, Kentucky, Virginia, and New England.