Yesterday, 11:12 AM
- France's Altice (OTC:ATCEY) is advancing its ambitions for a purchase of Time Warner Cable (NYSE:TWC) by talking with banks about raising debt for a bid for the highly-targeted cableco, Reuters reports.
- The company is talking with JPMorgan Chase, Nomura, BNP Paribas, SocGen, Barclays and RBC among others.
- If Altice were to go forward, it would try not to burden its balance sheet unnecessarily, sources tell Reuters, and financing could include a high-yield bond as well as loans.
- It's not a light concern. With Altice's agreement to buy Suddenlink for $9.1B, not to mention the recent purchase of SFR, the company is taking on debt in a hurry. The Suddenlink deal is expected to be financed in dollar-denominated debt that would be ringfenced at Suddenlink: "It is a purely US business so it would make sense to raise the debt in dollars," says a banker.
- Altice says total leverage, including full synergies, will be 6.1x 2014 EBITDA.
- TWC, meanwhile, seems to be moving on the news of each day: With chatter that a bid could come in at $170/share, TWC is up 2.7%, to $170.
- Previously: Altice enters the U.S. with Suddenlink stake (May. 20 2015)
- Previously: Cable M&A: Altice reportedly looking at TWC as well as Suddenlink (May. 19 2015)
- Previously: Vivendi chooses to sell SFR to Altice in €17B+ deal (Apr. 06 2014)
Thu, May 21, 8:07 PM
- Now up in As the Cable Turns: French billionaire and controlling shareholder of Altice (OTC:ATCEY) Patrick Drahi met in New York Wednesday with Time Warner Cable (NYSE:TWC) CEO Rob Marcus to talk about a cash-and-stock takeover, The Wall Street Journal is saying.
- Meantime, with Charter (NASDAQ:CHTR) also in active talks about a takeover, TWC's price tag (at least informally) seems to be going up, well north of Charter's 2014 bid of $132.50/share and Comcast's bid of roughly $158.82.
- TWC closed down 0.6% today at $165.52 and in later after-hours trading was down 5%, to $157.33.
Wed, May 20, 10:30 AM
- Cablevision Systems (NYSE:CVC) has climbed the mountain coming out of today's open, up 11.3% following news of Altice's plans for purchase of control of cable peer Suddenlink.
- With a $6.4B market cap and 2.8M subscribers, Cablevision is considered an acquisition target in an industry that is churning with rapid-consolidation pressures. Charter Communications is circling Bright House Networks as a precursor to a new bid for Time Warner Cable (TWC +3.7%), and Altice may be a player for TWC as well after its Suddenlink stake.
- Comcast, for its part, ran into regulatory objections with its bid for TWC and, with 22.4M subscribers, isn't necessarily safe from a potential forced breakup.
- At the Internet & Television Expo in early May, Cablevision CEO James Dolan suggested openness to tie-ups, encouraging market-by-market consolidation starting with its home market of New York City.
Thu, May 14, 3:13 PM
- Just as with INTX (the former Cable Show) last week, the MoffettNathanson Conference is another chance to get major cable CEOs in the same space and ask them about consolidation.
- Thomas Rutledge of Charter (NASDAQ:CHTR) -- which is discussing up to $30B in financing for a TWC deal -- says "Too much leverage is a bad thing," and that he'd be concerned about a 5x ratio of debt/earnings.
- Time Warner Cable's (TWC +1.5%) Rob Marcus isn't sure consolidation is so inevitable, doubting that "all cable companies will find their way into one of two camps." There are many possible deals where industrial logic doesn't prevail, and social dynamics can get in the way, he says.
- Rutledge on why Charter could deal where Comcast was rebuffed by regulators: "We’re a very different company and a very different circumstance. We’re not vertically integrated."
- Rutledge's concern about leverage puts a spotlight back on Greg Maffei's conference-call commentary that a little help from Charter's friends (by way of investment) could ease the deal. Maffei is chief of Liberty Broadband (NASDAQ:LBRDA), which owns 25% of Charter, and says Liberty's got cash and possible rights offerings along with partners.
Wed, May 6, 1:08 PM
- On stage in general session at the Internet & Television Expo (INTX), panel moderator Julia Boorstin assembled nearly all major cable CEOs and pressed them on hot M&A issues.
- Most were circumspect -- "The world's full of possibilities, but I can't tell you any of them," said Charter (NASDAQ:CHTR) CEO Tom Rutledge -- but James Dolan, CEO of Cablevision (CVC +6%), wasn't, urging market-by-market consolidation instead, starting with CVC's home market of New York City.
- “Consolidation of that marketplace would provide, one, a great deal of ingenuity and much more access to resources for the customers and lower prices,” he said, suggesting specifically that he'd deal with Time Warner Cable (NYSE:TWC), "and Comcast (NASDAQ:CMCSA) and other operators."
- Shares moved up 6% after his comments on indications that Cablevision might sell to a suitable acquirer.
- Previously: WSJ: Charter reaches out to TWC for friendly deal (May. 04 2015)
- Previously: 'As the Cable Turns': Industry deal talk turns to Bright House (Apr. 30 2015)
Thu, Apr. 30, 3:47 PM
- With Comcast's (CMCSA -1.2%) pursuit of Time Warner Cable (TWC -1.4%) dashed on the rocks, TWC and Charter Communications (NASDAQ:CHTR) have (separately) contacted Bright House Networks in the past week about acquiring them, The Wall Street Journal is reporting.
- With about 2M subscribers, Bright House is sixth-largest among cable MSOs. Charter had a deal to acquire Bright House a month ago, but that was contingent on the Comcast-TWC combo, so they need to start again during a 30-day "good faith" cycle.
- Time Warner Cable's interest in adding Bright House could be in making itself much tougher to acquire, and it would likely make the owning Newhouse family the biggest shareholder of the combination. In a deal with Charter, John Malone and Liberty Broadband (NASDAQ:LBRDA) would have the biggest voting stake.
- Meanwhile, TWC has deep ties to the Newhouse company -- TWC negotiates Bright House's programming and technology deals for a fee, and has right of first offer on the Newhouses' cable systems, the WSJ notes.
- Previously: TWC misses on earnings, logs best subscriber quarter (Apr. 30 2015)
- Previously: CNBC: Charter, TWC to discuss merger next week (Apr. 29 2015)
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.
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.
Thu, Apr. 2, 4:26 PM
- Over-the-top video services seems to have accelerating momentum as more unbundling happens every week, but high-yield pay-TV companies have little to worry about just yet, Moody's says in a new report.
- Customer inertia along with the limited competition they now face should buy providers time to adjust.
- "Evolutionary, not revolutionary" is how the firm describes the pay-TV shift, saying that OTT providers, including Sony and Apple, will take a small number of subscribers for now -- even though consumer perception seems to favor OTT options.
- The firm notes rising bills could force defections, but "the average customer may not realize how much content traditional pay TV service provides, from video on demand and across multiple devices."
- Pay TV stocks today: (CMCSA +1.5%), (TWC +1.9%), (CVC +0.9%), (CHTR -0.6%), (T +0.7%), (VZ +1.1%)
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.
Wed, Feb. 18, 11:14 AM
- In more details from 13Fs: John Paulson's Paulson & Co. closed its entire stake in Vodafone (NASDAQ:VOD) by Dec. 31.
- Paulson had a stake of 26.7M shares ($927.6M at today's price), which made up 3.65% of the fund's portfolio.
- The fund did add nearly 320K shares to its T-Mobile (NYSE:TMUS) stake.
- Paulson also added to stakes in Time Warner Cable (NYSE:TWC), boosting that stake by 18%, and DirecTV (NASDAQ:DTV), adding 9% to that stake.
- VOD shares are down 2.1% today, and are now up just 1.6% YTD.
Tue, Feb. 17, 11:11 AM
- Telecom analyst Craig Moffett sees not enough bad news priced in (and too much good), and has downgraded key cable stocks (CMCSA, CHTR, TWC) to Neutral from Buy.
- He's still got a Sell rating on Cablevision (CVC -5%).
- “With the stocks having largely achieved our target prices, with cord cutting risks mounting and with regulation clouding the path forward in broadband, it seems to us to be time to reduce exposure," Moffett says.
- He lowers his estimate of a successful Comcast-TWC merger to 60% given increasing public attention and sentiment against the combination.
- And he doesn't mince words about Title II treatment: "At its core, Title II is about price regulation ... It would be naive to believe" that the rules changes won't introduce risk to pricing power.
- Current action: (CMCSA -1.5%), (CHTR -1.6%), (TWC -1.5%)
- Previously: Telecom stocks soar as FCC's Wheeler advocates utility stance on regulation (Feb. 04 2015)
- Previously: AT&T's Stephenson: Litigating FCC rules 'quite certain' (Feb. 13 2015)
Thu, Feb. 12, 7:06 PM
- Following earnings, Time Warner's (TWX +2.8%) got another challenge ahead in negotiations for programming renewals with Comcast (NASDAQ:CMCSA), Dish Network (NASDAQ:DISH) and Time Warner Cable (NYSE:TWC).
- With distributors slimming down packages (and programming costs), economies of scale are likely to play in Time Warner's favor vs. smaller programmers.
- The same dynamic is driving chatter around a CBS merger with Viacom (VIA, VIAB) or even TWX -- the need for size to get more mojo in negotiations with stingier distribution channels.
- An increasing factor is the gradual unbundling of programming from traditional distributors through services like Sling TV, or subscription services from CBS and HBO.
- TWX's outlook looks increasingly dependent on accelerating revenue growth -- "which is likely to require successful renegotiation of the last two major domestic (pay-TV) deals and highly successful box office performance," says Pacific Crest's Andy Hargreaves.
- Previously: Dish opens Sling TV signups for all U.S. viewers (Feb. 09 2015)
Wed, Feb. 4, 11:42 AM
- Breakdown of FCC Chairman Tom Wheeler's op-ed on net neutrality: "Enforceable, bright-line rules" that ban paid prioritization ("fast lanes") and blocking/throttling of services, including for mobile broadband.
- The investment key for related stocks: "All of this can be accomplished while encouraging investment in broadband networks. ... My proposal will modernize Title II, tailoring it for the 21st century, in order to provide returns necessary to construct competitive networks. For example, there will be no rate regulation, no tariffs, no last-mile unbundling."
- FCC voting is scheduled for Feb. 26.
- Related stocks: (CMCSA +2.8%); (CVC +2%); (TWC +3.1%); (T +0.6%); (VZ +0.7%); (CHTR +4.3%); (DISH +2.6%); (DTV +1%); (CCOI +3.9%)
Wed, Feb. 4, 11:31 AM
- FCC Chairman Tom Wheeler has released an op-ed hinting at the commission's new stance on net neutrality rule -- and it suggests utility-like regulation for fixed and wireless broadband.
- "This week, I will circulate ... proposed new rules to preserve the Internet as an open platform for innovation and free expression. This proposal is rooted in long-standing regulatory principles, marketplace experience, and public input received over the last several months."
- Wheeler calls directly for Title II authority in "the strongest open Internet protections ever proposed by the FCC."
- Stocks on the move: (CMCSA +3.3%); (CVC +2.9%); (TWC +4%); (T +0.8%); (VZ +0.7%); (CHTR +4.3%); (DISH +3.3%); (DTV +1.2%); (CCOI +4.3%)
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.
Other News & PR