and the Home Box Office pay service, among other assets. Of course, there were some risks. MediaOne was a conglomerate with holdings in cable and wireless companies outside the United States. Any deal would require regulatory approval, which would re- open familiar issues such as "open cable." Plus, this time out, the com- pany would rub up uncomfortably against the FCC's cross-ownership rules. TCI and MediaOne by themselves would fall below the then- current 30 percent limit on households passed. But under a bizarre "attribution rule," if the company owned more than 5 percent of a cable system, IOO percent of the households it passed would be attrib- uted to it. With attribution for homes passed by Time Warner's cable systems, a combined TCI and MediaOne would theoretically pass 45 percent of U.S. homes, well over the cap. While the FCC's rule was being challenged in court and in any case was expected to be relaxed, no one knew what it would mean for an AT&T acquisition of Media- Finally, there was financial risk. The company's earnings per share would suffer dilution of about 30 cents per share because the company would have to issue about 660 million new shares. Also, to trump Comcast, AT&T's offer would have to include cash, most of which would have to be borrowed, adding to the $4.5 billion in debt that would come with MediaOne. While many of MediaOne's nonstrategic assets could be sold, their value was uncertain, and taxes would reduce the net proceeds somewhat. The bankers expected AT&T's stock price to take a hit, but to recover even more quickly than it did after the TCI acquisition was announced. The good news, if there was any, was that Chuck Lillis was reported to believe that a deal with AT&T was in MediaOne's best long-term interests. While Hostetter had decided not to participate directly in an AT&T bid, he said he would be supportive, as he was offended by the limited voting rights that Comcast intended to give MediaOne share- owners. The rating agencies had been briefed on the possibility of a bi