Feb. 5 (Bloomberg) -- Cox Communications Inc., the third- largest U.S. cable company, may bid for wireless assets left over from Verizon Communications Inc.’s Alltel Corp. purchase to help build out its own mobile-phone service, analysts say.

“Cox has always been ahead of the game, so a bid makes sense,” Kaufman Bros LP’s Todd Mitchell said in an interview. “They’re in a great capital position, unlike their competitors, and don’t have shareholders to report to.”

Closely held Cox has already invested at least $500 million through airwave purchases, with plans to start offering service as soon as this year. The Verizon operations, which span more than 20 states, would help Cox compete with telecommunications companies that offer packages of phone, Internet and television service.

Verizon said yesterday that more than 30 parties expressed interest in bidding for the assets, which the carrier is shedding to satisfy the conditions of its $28.1 billion acquisition of wireless carrier Alltel. Spokesman Peter Thonis declined to name the potential bidders.

Verizon Communications, which co-owns Verizon Wireless with Vodafone Group Plc, rose 58 cents to $31.19 at 4 p.m. in New York Stock Exchange composite trading. The shares have dropped 8 percent this year.

Spokesman David Grabert declined to comment on whether Cox would seek the assets. The company, based in Atlanta, was taken private by the Cox family in 2004. The cable operator, which has more than 6 million residential and commercial customers, offers phone service in Georgia, Kansas and Ohio, where some of the Verizon assets are.

“Currently Cox has no viable option to build out its wireless space,” said Christopher King, a Baltimore-based analyst with Stifel Nicolaus & Co. “If there was one cable company looking to bid on Verizon’s wireless assets, it would be them.”

Cablevision Bid?

The Wall Street Journal said this week that the assets may be worth about $3 billion. Cablevision Systems Corp., the New York-area cable-television provider, may be another contender for the wireless assets, the analysts said.

The company had about $11.3 billion in long-term debt as of September, making a bid less likely, they said. Kim Kerns, a spokeswoman for Cablevision, declined to comment.

Last year, Cox said it was negotiating with phone makers to sell handsets. Comcast Corp. and Time Warner Cable Inc., the two largest U.S. cable operators, have invested in developing Clearwire Corp.’s wireless network, aimed at challenging AT&T Inc. and Verizon.

“Cox could be opportunistic and make a bid,” said Jonathan Atkin, a communications analyst with New York-based RBC Capital Markets. “At the right price, it seems plausible.”

To contact the reporter on this story: Kelly Riddell in Washington at Kriddell1@bloomberg.net

Last Updated: February 5, 2009 16:49 EST