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Comcast, Charter Looking at Purchase of Time Warner Cable

27 Nov, 2013 By: Doug McPherson

NEW YORK – Reports continue of Comcast Corp. and Charter Communications Inc. buying Time Warner Cable Inc. and dividing its assets between them.

Last week, CNBC reported Comcast was weighing a Time Warner Cable bid, and the Wall Street Journal said Charter was in talks with banks to find financing.

The news jolted stock prices late last week: Charter’s stock was up more than 5 percent, and Time Warner Cable soared 10.3 percent in midday trading. Cablevision Systems Corp., DISH, Lin Television, Tribune and Media General all saw stock price spikes, as well.

Ad Age cited “people with knowledge of the matter” (they asked not to be identified because the deliberations are private) have said talks were preliminary, and a Time Warner Cable breakup is one option amid several under consideration.

Insiders say Comcast and Charter are also weighing individual bids for the cable giant.

A Comcast and TWC deal would combine the two largest U.S. cable companies, but it would also bring stringent scrutiny from the Federal Communications Commission (FCC), Craig Moffett, founder of research firm MoffettNathanson told Ad Age. A merger would yield 33.3 million video customers in the U.S. – about three-quarters of the cable industry, says the National Cable Television Association (NCTA).

"The FCC would be concerned that Comcast would have de facto control over what content would be available on TV," Moffett said. "If a TV programmer couldn't cut a deal with Comcast, they wouldn't exist. Comcast becomes a behemoth."

John Malone, the billionaire who backs Charter, has been a proponent for more consolidation in the cable industry, saying it will help providers cut costs and get better rates from the networks.

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