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MIDDLETOWN, N.Y. (AP) – The head of Mediacom Communications Corp. said Tuesday he has withdrawn a proposal to take the cable television company private after its board rejected his latest offer. Its shares dropped almost 17 percent in morning trading.

Rocco B. Commisso, who founded Mediacom in 1995 and serves as chairman and CEO, said he was dropping his May 31 offer to buy all the shares of Mediacom he didn’t already own.

Commisso has initially offered to pay about $245 million, or $6 per share, for each of the remaining Class A and Class B shares he didn’t own. His stake amounts to about 40 percent of the company’s common stock, representing 87 percent of the voting power.

In a company news release Tuesday, Commisso said he was withdrawing his bid and ending discussions with a special committee established to consider the offer. The panel rejected what Commisso called “a meaningful increase to his initial offer price.” He also said he agreed that his offer would be subject to approval by holders of a majority of the shares he doesn’t own.

The news release didn’t provide financial details of his latest offer.

Commisso said he believes the special committee’s rejection isn’t in shareholders’ best interests.

“I am very disappointed with the highly unusual process and ground rules established by the special committee and its financial and legal advisers to evaluate my proposal,” he said.

Commisso said he has no interest in selling his Mediacom shares, and remains focused on working with the management team at the 4,500-employee company.

The $6 per-share price Commisso was originally offering represented a premium of nearly 13 percent from the stock’s $5.33 closing price before he announced his offer.

The stock has since risen, closing at $6.85 on Monday, and has traded in a 52-week range of $3.85 to $7.65.

Mediacom shares fell $1.14, or 16.6 percent, to $5.71 in morning trading Tuesday.

Mediacom, based in Middletown, says it is the nation’s seventh-largest cable television company based on the number of basic video subscribers. Its services are concentrated in the Midwest and South. It also provides broadband services.

Copyright 2010 The Associated Press.

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