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Comcast Eyes $850M Bond Offering

Philadelphia -- Comcast Corp. is planning an $850 million
bond offering tied to the performance of AT&T Corp. stock -- called
"Participating Hybrid Option Note Exchangeable Securities," or
"PHONES" -- to raise cash for general business purposes.

Comcast, in a filing with the Securities and Exchange
Commission March 9, said it will issue 8.7 million of the subordinated debentures, due
2029. The PHONES bonds will be convertible into AT&T shares after maturity.

Merrill Lynch & Co., Credit Suisse First Boston,
Goldman Sachs & Co., Solomon Smith Barney, Bear Stearns & Co., Donaldson, Lufkin
& Jenrette Inc. and Lazard Freres & Co. LLC are serving as underwriters for the

Chicago-based Duff & Phelps Credit Rating Co. has
assigned a "BB-plus" rating to the bonds, reflecting Comcast's strong core
cable operations and its QVC electronic-retailing operations.

Duff & Phelps also noted Comcast's low debt
obligations, its significant cash holdings and its other monetizable assets.

Comcast currently has about 26.6 million shares of AT&T
stock (10 million of which are part of the bond offering), and the offering is thought to
be a way to gain some liquidity from those shares without having to sell them.

Comcast received the AT&T stock as part of its 20
percent interest in Teleport Communications Group, a private-line telephony carrier that
was acquired by AT&T in 1998.