Another One Bites the Dust: Comcast Buys Time Warner, Extends Cable Domination
It’s finally happened. Comcast (NASDAQ:CMCSA), the largest cable company in the United States, announced that it is purchasing rival Time Warner Cable (NYSE:TWC), meaning that basically anyone in the country with cable service will now be writing their monthly checks to Comcast. Comcast purchased Time Warner in an all-stock deal amounting to $45.2 billion.
Charter Communications (NASDAQ:CHTR) was in talks about buying Time Warner for months and had even approached Comcast about the possibility of a joint deal, in which Charter and Comcast would split up Time Warner’s markets. Apparently Comcast has decided to cut out the middleman and buy Time Warner as a whole itself. According to people familiar with the matter who spoke to Bloomberg, talks between Charter and Comcast broke down when Charter wasn’t willing to give Comcast as many of Time Warner’s markets as it wanted.
Charter previously made an offer of $132.50 per share, but Time Warner said that was “grossly inadequate” and insisted the company wouldn’t accept any bid under $160 per share. The Comcast deal amounts to $158.82 per share. Earlier this week, Charter issued a statement calling for Time Warner to entirely replace its board of directors to put more pressure on the company to re-evaluate a Charter acquisition. Now it looks like Time Warner made the right choice in rejecting Charter’s bid.