Fri, Apr. 24, 2:48 PM
- Shares spiked briefly for Charter Communications (NASDAQ:CHTR) this hour -- and Time Warner Cable has leapt up to +5.9% -- on word that Charter's advisers have already started pursuing friendly talks with TWC for a speedy acquisition.
- Executives haven't spoken yet and so there's no price or structure to debate. Though one source reports TWC is already balking at the debt level of the combined entity.
- Charter's hostile bid for Time Warner failed before, but to make a friendly deal, it may have to come with more than Comcast's ~$158.82/share offer to make it work.
- Previously: Comcast, TWC move higher premarket on merger's end (Apr. 24 2015)
- Previously: It's over: Comcast officially ends $45B pursuit of TWC (Apr. 24 2015)
Fri, Apr. 24, 9:15 AM
- Comcast (NASDAQ:CMCSA) is trading up 1.3% premarket, and Time Warner Cable (NYSE:TWC) is 0.8% higher as well, after confirmation that their $45B merger deal is dead.
- In statements by the Justice Dept. and FCC thanking each other for their cooperation, it's clear that FCC Chairman Tom Wheeler was against the deal, which would have made agency approval a very long shot.
- It's also clear why Wheeler was opposed: It's about broadband, not cable, and protecting the burgeoning streaming video market. "The proposed merger would have posed an unacceptable risk to competition and innovation especially given the growing importance of high-speed broadband to online video and innovative new services."
- While Comcast doesn't pay a breakup fee with the deal's end, that doesn't mean everyone walks away cheaply: Advisers including bankers and lawyers will lose out on $380M in fees, chiefly Goldman Sachs (NYSE:GS), banker for Charter Communications (NASDAQ:CHTR). J.P. Morgan Chase (NYSE:JPM) will drop from second to third in the league tables. As a mitigating factor, more deals are likely on the way, though.
- Other sector players premarket: AT&T -0.3%; Verizon -0.2%.
Fri, Apr. 24, 8:34 AM
- After a late Thursday board meeting, Comcast (NASDAQ:CMCSA) has confirmed it's dropping its $45B plan to acquire Time Warner Cable (NYSE:TWC) -- a stunning reversal of a 15-month plan, which got less stunning as hurdles began to mount in recent weeks.
- "Today, we move on," says Comcast CEO Brian Roberts. "Of course, we would have liked to bring our great products to new cities, but we structured this deal so that if the government didn't agree, we could walk away." It's a cheap walk-away for Comcast, which had no breakup fee in the deal.
- What next? Consolidation is still likely in a deeply uncompetitive industry. Other companies are now officially front and center in pursuit of TWC, notably John Malone's Charter Communications (NASDAQ:CHTR), which could re-launch its own failed effort. CHTR-TWC would have 16.5M broadband subscribers together, less than Comcast's 22M.
- Charter's deal with Comcast aimed at divestment and easing the Comcast-TWC transaction also blows up. What about Charter's deal to acquire Bright House?
- As for Comcast, it could take its stored-up momentum outside of cable -- to someone like Netflix (NASDAQ:NFLX), as BTIG's Rich Greenfield hints? Or to a telecom like T-Mobile (NYSE:TMUS)?
- Updated: Time Warner Cable statement. "We have always believed that Time Warner Cable is a one-of-a-kind asset," says Chairman and CEO Robert D. Marcus. "We are strong and getting stronger."
Thu, Apr. 23, 3:09 PM
- Bloomberg reports Comcast (CMCSA +2.2%) plans to drop its hotly-contested efforts to merge with Time Warner Cable (TWC +0.7%), and could make an announcement as soon as tomorrow. Comcast has moved higher in response.
- The report comes a day after the WSJ reported the FCC staff recommends a hearing on the deal, and a week after Bloomberg reported DOJ antitrust lawyers are leaning against it.
- Charter (CHTR +0.4%), which has suggested it's interested in TWC if the Comcast deal falls through, has moved slightly higher.
Wed, Apr. 22, 9:19 PM
- A key setback for Comcast's (NASDAQ:CMCSA) $45B takeover of Time Warner Cable (NYSE:TWC) as FCC staff has recommended that the agency designate a hearing -- what some regulatory experts call a "deal-killer," The Wall Street Journal reports.
- A "hearing designation order" would put the merger in the hands of an administrative law judge, and while Comcast would be able to keep making its case, it would be a strong sign the FCC doesn't see the merger to be in the public interest.
- Earlier, Comcast execs sat down with the Dept. of Justice and the FCC in hopes of salvaging a deal that is running into significant hurdles at the government level.
- Previously: Comcast-TWC deal moves to Capitol Hill in day of talks (Apr. 22 2015)
Wed, Apr. 22, 7:15 PM
- "There are essentially three options: OK the deal, negotiate a consent decree to impose conditions, or sue to block the deal. The first is not in play," says media lawyer Andrew Jay Schwartzman to CNN about the now somewhat shaky $45B Comcast-Time Warner Cable (CMCSA, TWC) merger deal, following a marathon day where Comcast executives sat down with the Justice Department and then the FCC.
- Comcast issued a statement saying it's not appropriate to share the content of the meetings.
- With no breakup fee, there's less disincentive for Comcast to up and walk away from the deal, which has been more than a year in the making. But that would depend heavily on whether the government sues to block the deal, or just seeks concessions to make it happen.
- Comcast's new sweetener is promising to expand its low-income "Internet Essentials" program that offers $10/month broadband to qualified households. Another statement from the company came today to "set the record straight" on the program, saying that critics are recycling old claims. (This must include articles like this one, referring to IE as Comcast's merger "trump card" and proclaiming it "bullcrap.")
- Critics say that while Comcast claims it's "one of the most successful, if not the most successful, private sector initiatives to close the digital divide ever," the company has signed up just 13.4% of 2.6M eligible households.
- Previously: Reuters: FCC staff sets Wednesday briefing on Comcast-TWC (Apr. 21 2015)
Tue, Apr. 21, 7:17 PM
- FCC officials tomorrow will brief staff about the proposed $45B merger of Comcast (NASDAQ:CMCSA) and Time Warner Cable (NYSE:TWC), Reuters is reporting -- though with no news about which way officials are thinking.
- The briefing may be light on specifics but might offer some clues to how the FCC will deal with recent public opposition to the buyout. The FCC's ruling on the deal will focus on public interest, while the Department of Justice focuses on antitrust concerns.
- The staff will also be briefed tomorrow on AT&T's (NYSE:T) $48B deal to buy DirecTV (NASDAQ:DTV), according to Reuters.
- Previously: WSJ: Comcast, Time Warner Cable to meet with Justice Dept. (Apr. 18 2015)
- Previously: Comcast defends TWC deal, announces 2-Gbps California plan (Apr. 17 2015)
Sat, Apr. 18, 10:55 PM
- Comcast (NASDAQ:CMCSA) and Time Warner Cable (NYSE:TWC) will meet Wednesday with the Justice Department in hopes of negotiating concessions to assuage the department's reported opposition to their $45B merger, The Wall Street Journal is reporting.
- It's the first time the companies would meet with any regulators -- and the deal is nearing its endgame with both Justice and the FCC.
- Bloomberg reported Friday that staff attorneys at Justice were leaning toward blocking the deal, though any final word would come from senior officials there.
- The Justice Department's concern is antitrust issues in the combination of two giant service providers; the FCC is evaluating the deal to see whether it is in the public interest.
Fri, Apr. 17, 7:06 PM
- As reports spread that Justice Dept. attorneys were likely to recommend blocking Comcast's (CMCSA -2.1%) $45B buyout of Time Warner Cable (TWC -5.4%), the cable companies both argued there was no basis to block the deal.
- It'll mean "faster broadband speeds, access to a superior video experience, and more competition in business services resulting in billions of dollars of cost savings," according to a Comcast statement. "These benefits have been essentially unchallenged in the record."
- Meanwhile, over at the FCC, 37 groups opposed to the deal wrote Tom Wheeler, the agency's chairman, saying that even conditional application of net neutrality regulation wouldn't soften their opposition. Signatories included Dish, Consumers Union, the Writers Guild of America, West, and Free Press; "they don't make any new arguments," Comcast responds.
- Some volume came into competitive stocks and gave them a (relative) lift after the news: Charter Communications (NASDAQ:CHTR) came off lows to finish down 1.9%; Cablevision Systems (NYSE:CVC) rebounded to finish just -0.3%.
- In February, BTIG analyst Rich Greenfield laid out why he thought the deal would ultimately get rejected.
- Then shortly after the Justice Dept. news broke, Comcast noted it was bringing its top-speed 2-Gbps Gigabit Pro service to the California Bay Area. The company previously said it would launch the service in Atlanta (where Google Fiber and AT&T plan 1-Gbps service); it's setting June for the California launch, but still no word on possible pricing.
Fri, Apr. 17, 2:09 PM
- The Justice Department's staff attorneys looking into Comcast's (NASDAQ:CMCSA) $45B bid to purchase Time Warner Cable (NYSE:TWC) are close to urging the deal be blocked, Bloomberg reports -- and they're also not working with Comcast to secure changes that would satisfy them.
- Already lower with the market today, TWC took a cliff dive, now -7%. Comcast shares are still down 2.8%.
- The lawyers could submit their review as soon as next week to deputy assistant AG Renata Hesse. Officials will then decide on whether to sue to stop the deal.
- Hesse is running the review since antitrust chief Bill Baer recused himself, as a previous representative of NBCUniversal in its takeover by Comcast.
Fri, Apr. 10, 9:07 PM
- While an administrative judge has recommended approval by California's Public Utilities Commission of Comcast's (NASDAQ:CMCSA) $45B acquisition of Time Warner Cable (NYSE:TWC), the agency's commissioner Mike Florio has posted an "alternative proposed decision" signaling he'd deny the deal.
- Florio says emphatically that "no conditions could mitigate all of the negative impacts of the proposed transaction," including "reduced competition for wholesale inputs ... constraining consumer options for those competitive services."
- Previously: Wolff: Get ready for 'M&A mania' with media consolidation (Apr. 09 2015)
- Previously: Sling TV CEO: We oppose Comcast-TWC merger (Apr. 06 2015)
Thu, Apr. 9, 9:08 PM
- Don't let recent merger challenges and failures fool you, Michael Wolff argues: "M&A mania" is coming to a media conglomerate near you amid pressure for a new wave of consolidation.
- "Perhaps never before has consolidation been so much the flavor of the month, nor has it seemed so difficult to get a taste," he writes. "The table is set, but nobody's sitting down to eat."
- If Comcast (NASDAQ:CMCSA) fails in its bid for Time Warner Cable (NYSE:TWC), he notes, it just means other cablers will step up to match Comcast's ambition, and Comcast will still look for a way to stay dominant.
- He points to a number of mergers he thinks are easily imaginable: Viacom (NASDAQ:VIA) and FOX? Disney (NYSE:DIS) and Time Warner (NYSE:TWX)? TWC and Charter (NASDAQ:CHTR)? Discovery (NASDAQ:DISCA) and, well, most anyone (Disney, Fox, CBS)?
- Factors encouraging the wave: Media's all about video now, and the pure-play aspect makes merger logic cleaner; distribution and content are separate and now even antagonistic businesses; the growth of over-the-top means not unbundling but re-bundling; and everyone needs scale for negotiation strength in content and ad deals.
- Other key players: John Malone (LMCA, LBTYA, STRZA); Verizon (NYSE:VZ); Lions Gate (NYSE:LGF); Scripps Networks (NYSE:SNI); Netflix (NASDAQ:NFLX); DirecTV (NASDAQ:DTV) and AT&T (NYSE:T); Dish Network (NASDAQ:DISH).
Mon, Apr. 6, 3:23 PM
- "We actually do oppose that merger -- we don't think it's good for consumers; we don't think it's good for the industry," says Roger Lynch, CEO of Sling TV (NASDAQ:DISH), about the proposed merger between Comcast (NASDAQ:CMCSA) and Time Warner Cable (NYSE:TWC).
- Asked on Bloomberg TV whether Comcast ambitions amount to merely "scale" or monopoly, Lynch said "I think it's too much scale, it's unprecedented ... if that merger were completed, they would have over half of the truly high-speed broadband connections in the country, and past something 65% of the homes ... it's too much scale for one company."
- Sling TV -- whose strategy centers on a "skinny bundle" of mainly live programming served over the Internet -- had some troubles Saturday in a critical area, live sports, experiencing streaming problems serving up the NCAA Final Four for its viewers. The company apologized for problems it blamed on "extreme sign-ups and streaming."
- Comcast and Time Warner are awaiting progress at the FCC after the merger's "deal clock" was reset by the federal regulators.
- Previously: FCC pauses review of Comcast-TWC, AT&T-DTV; likely weeks away (Mar. 13 2015)
Tue, Mar. 31, 3:17 PM
- Charter Communications (NASDAQ:CHTR) is up 6.2% and has touched a record-high $199 in the wake of its deal to acquire Bright House Networks, which would make it the country's No. 2 cable operator (Charter is now No. 4; Bright House is No. 6).
- The deal's dependent on Comcast's (NASDAQ:CMCSA) successful pursuit of Time Warner Cable (NYSE:TWC) -- Charter's own bid for TWC fell apart, and Charter could step back in if Comcast's plan falters -- and if Comcast takes such a clear lead, Charter may not stop at Bright House in trying to catch up.
- Mediacom, CableOne and Suddenlink could be the next targets. "I think it is inevitable most of the rest of the cable industry not owned by Comcast is sold to Charter," Pivotal Research Group analyst Jeff Wlodarczak tells Reuters.
- As for John Malone, his Liberty Broadband (NASDAQ:LBRDA) -- Charter's biggest shareholder -- has agreed to purchase $700M of shares in the Charter/Bright House combo, in transactions that would leave it with voting power of about 25%.
- Charter bonds picked up on the news as well.
Tue, Mar. 31, 9:05 AM
- Charter Communications (CHTR, up 5.2% premarket) has reached agreement to acquire Bright House Networks for $10.4B.
- The outlines of a deal were there, but it's early -- it was expected that a ruling would come down on Comcast's (NASDAQ:CMCSA) merger with Time Warner Cable (NYSE:TWC) before Charter made a move.
- The structure: a partnership where Charter owns 73.7% and Advance/Newhouse owns 26.3%. Charter will pay $2B in cash.
- There's still several conditions to wrapping the deal, including Charter transactions with Comcast.
Tue, Mar. 17, 2:03 PM
- With the proposed merger of Comcast (NASDAQ:CMCSA) and Time Warner Cable (NYSE:TWC) getting all the oxygen from the post-net-neutrality FCC, the $48.5B deal that AT&T (NYSE:T) has to acquire DirecTV (NASDAQ:DTV) appears to be getting a relatively free pass.
- Both deals will create a company controlling more than a quarter of pay TV -- so it may be Internet access that's drawing extra scrutiny. The combined Comcast-TWC company would serve high-speed Internet to almost 40% of Americans.
- Even FCC petitions opposing the deals are telling: 20 against Comcast-TWC, five against AT&T-DirecTV. And 88,000 brief comments opposing Comcast-TWC, 14,000 opposing AT&T-DirecTV.
- One critic of the T-DTV deal told Reuters that Justice Department reviewers responded in a meeting with "few questions" and "blank stares."
- Today: CMCSA -0.7%; TWC -1%; T +0.1%; DTV +0.2%.
- Previously: FCC pauses review of Comcast-TWC, AT&T-DTV; likely weeks away (Mar. 13 2015)
- Previously: Brean downgrades DirecTV to Hold; AT&T offer priced in (Feb. 23 2015)
TWC vs. ETF Alternatives
Time Warner Cable Inc provides video, high-speed data and voice services. The Company also offers security and home management services, networking and transport services and enterprise-class, cloud-enabled hosting, managed applications and services.
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