Charter offers to buy Time Warner Cable for $61.3B

Charter offers to buy Time Warner Cable for $61.3B

Summary: From the "unbelievable amount of money" department, the Liberty Media-backed company throws billions in efforts to merge with the third largest U.S. cable giant. But Time Warner isn't having any of it.

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TOPICS: Networking
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(Image: CBS)

Charter Communications is offering $61.3 billion to snap up the third largest U.S. cable operator Time Warner Cable.

But a deal confirmed on Monday by Charter may still be a long way away.

The offer, which comes out at $132.50 a share, saw Time Warner Cable ($TWC) dip slightly just before the closing bell. Shares in the cable giant rose by 0.5 percent, almost offsetting any end-of-day losses.

Charter dipped by 1.6 percent at market close, but recovered marginally by 1.2 percent in after-hours trading.

But Because Time Warner Cable management reportedly declined to enter discussions, the The New York Times reported, Charter is taking the case to its shareholders.

The report said major holders of Time Warner stock will be persuaded to vote in favor of the merger.

Charter offers high-speed Internet, telephone, and cable services to more than 6.8 million customers across the United States.

Time Warner Cable has an estimated 14 million cable subscribers across the U.S. The company in October acquired U.S. east-coast fiber network DukeNet for $600 million.

Charter said it had made "repeated overtures" for more than six months, but no deal was made. The company said Time Warner's quick response, among other things, "led Charter to determine there is no genuine intent from Time Warner Cable's management and Board of Directors to engage in a merger agreement."

"We remain open to real engagement," wrote Charter chief executive Thomas Rudledge in a letter to Time Warner Cable chief executive Robert Marcus dated January 13. 

"We also believe that the new combined company, through potential future swaps and divestitures with other industry participants, can help rationalize the geographic holdings of the industry into more efficient entities capable of providing better services and products into a very competitive marketplace, thus generating higher returns for the combined company and the industry at large," the letter continued.

In other words: combine the two companies and take on Comcast, Verizon, and AT&T in the top running.

Topic: Networking

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  • Not sure if this is helpful or not for customers

    Charter acquired our cable provider recently. There haven't been any recent upgrade/improvements, but then things aren't worse either. The company that bought out the cable prior to that added much faster internet.

    I wish we had another cable provider in the area, instead of just one, then we would be able to get real competitive prices on Internet and TV.
    grayknight
  • 'wish we had another cable provider in the area'

    methinks this is a common wish around the country.
    BitBanger_USA
  • 'wish we had another cable provider in the area'

    We have more than one choice.
    They do read each others adds and are careful not to actually cut prices for more than an introductory period.
    They also make sure their sales staff knows how to upsell.
    bwexler