After months of rumors that the company was on the tablet, it looks like a deal may soon be reached for Time Warner Cable. According to a report from Bloomberg, Charter Communications will seek to acquire Time Warner Cable for $132.50 per share, pending approvals of course. The deal will see Charter pay $83 per share of Time Warner Cable, plus $49.50 per share in Charter stock. “Charter today sent a letter to Time Warner Cable Chief Executive Officer Rob Marcus, explaining why the company’s offer is beneficial for shareholders,” Bloomberg’s Alex Sherman reported. “Charter is attempting to acquire Time Warner Cable, a company with an enterprise value more than twice Charter’s size, to create a provider of TV, Internet and phone for about 20 million customers in 38 states. Rutledge said he last proposed an offer in late December, around Christmas, which Marcus rejected.”
What’s the opposite of a Christmas miracle? How about a merger between two of the largest cable providers in the United States? Bloomberg reports that Charter, previously rumored to be in the running for a buyout of Time Warner Cable, is drafting an offer letter that it could send out as early as next week to acquire TWC for under $140 per share. According to Bloomberg’s source, “the offer will include cash and Charter stock.” The FCC has already hinted that it would reject Comcast’s bid to try to buy Time Warner Cable, so it’s hard to imagine Charter will be any more successful. Comcast is not a part of this deal, despite previous reports of a joint offer, but the company is watching closely to see how the situation develops.
If there’s one thing that Americans have been clamoring for, it’s fewer choices when it comes to cable providers. CNBC reports that Comcast has been asking the Federal Communications Commission about the regulatory hurdles it might face if it tries to buy Time Warner Cable in a massive merger that would turn America’s two largest cable companies into an even bigger behemoth. While Time Warner Cable is apparently listening to several suitors’ offers, CNBC’s sources say that the company would prefer to be bought out by Comcast over any other competitor. More →
Cable CEOs don’t seem to understand why more and more customers are shunning their pay TV services. The Wall Street Journal reports that Charter Communications CEO Tom Rutledge said that he’s been “surprised” recently by the number of subscribers who are opting to go only with broadband services and are forgoing his company’s pay television options. Rutledge said that he thinks customers are shunning pay TV because Charter’s video service still needs to be improved and not because they’re opting to just get a broadband connection and watch Netflix and Hulu. Of course, Charter isn’t the only cable company to see a rise in cord cutting as Time Warner Cable last quarter announced that it had lost a whopping 300,000 pay TV subscribers while Comcast has reported losing tens of thousands of pay TV subscribers this year.