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@Home stock soars on new deal

The cable modem service's stock hits a record high after an alliance with Cablevision to deliver high-speed Net access to the Northeast.

@Home's (ATHM) stock hit a record high today after the company announced an alliance yesterday with Cablevision Systems to deliver high-speed Internet access to Northeastern markets.

The company's stock closed at 26-5/8, up 4-1/4. As previously reported, @Home's deal with Cablevision, the nation's sixth-largest cable TV operator, gives it access to an additional 5.5 million homes in cities such as Boston, Cleveland, and New York.

As part of the deal, Cablevision receives a warrant to buy 11 million shares of @Home's stock at 50 cents per share, equal to an 8 percent stake if exercised today. In return, Cablevision will make its cable systems available to @Home on an exclusive basis. Cablevision joins Tele-Communications Incorporated (with a 39.5 percent stake), Comcast (12.4 percent), and Cox Communications (12.4 percent) as @Home cable partners. Venture capital firm Kleiner Perkins Caufield & Byers also holds a 11.3 percent stake.

The deal with Cablevision--whose stock rose 4-5/16 today to close at 68-1/4--clears the way for @Home to reach more than 50 million homes in North America.

Cablevision already is installing a hybrid fiber-coaxial architecture to its cable TV network; sixty percent of its cable plant now is upgraded. With the @Home alliance, Cablevision's so-called "Optimum Online" service will utilize @Home's network infrastructure and broadband content.

"By joining forces with Cablevision, @Home gains access to a significant concentration of homes in key major metropolitan markets in the Northeast corridor, enhancing our potential service footprint," said @Home chief executive Tom Jermoluk.