The company created in the deal announced Monday would serve 11 million cable customers with a potential market of 18 million homes. The two companies generated a total of more than $8 billion in revenue last year.
In addition to cable systems, Philadelphia-based Comcast's interests include a 57 percent stake in the home-shopping cable network QVC Inc.; the National Hockey League's Philadelphia Flyers; the National Basketball Association's Philadelphia 76ers; and stakes in the E! and Golf Channel cable networks.
MediaOne, based in Englewood, Colorado, is the No. 3 cable provider after Time Warner and AT&T. It also has interests in wireless communications businesses outside the United States serving more than 3 million customers.
According to the companies, their combined capitalization would be nearly $97 billion.
Under the agreement, MediaOne shareholders will receive 1.1 shares of Comcast stock for each of MediaOne's shares, or $80.16 a share based on Comcast's closing stock price Friday of $72.875. That's a premium of 32 percent above MediaOne's closing price Friday of $60.75 a share.
A spokesman for Comcast said 741,000 shares of Comcast stock would be issued to complete the deal.
The agreement has been approved by the boards of both companies. It is subject to the approval of Comcast and MediaOne shareholders, and of federal and local regulatory agencies. The companies said they expect the deal to be closed by the end of the year.
Ralph J. Roberts, the chairman of Comcast, would be chairman of the combined company. Brian L. Roberts, the chief executive of Comcast, would be president. Charles M. Lillis, president, chief executive officer and chairman of MediaOne, would serve as a vice president of Comcast and become a member of the Comcast board of directors, along with three additional MediaOne designees.
The agreement would allow MediaOne to accept a better offer, but it would have to pay Comcast $1.5 billion for breaking the deal.