Comcast Confirms $45.2B Time Warner Cable Purchase

Comcast Confirms $45.2B Time Warner Cable Purchase

Details of plan include $10 billion stock buyback

Comcast Corporation confirmed early Thursday its plan to buy Time Warner Cable for $45.2 billion. The deal expands the vast reach of Comcast, already the largest cable company and the owner of NBCUniversal.

Boards of both companies have approved a definitive agreement for the merger, first reported Wednesday by Reuters and other outlets. In the friendly, stock-for-stock transaction, Comcast will acquire 100 percent of Time Warner Cable's 284.9 million outstanding shares for Comcast shares worth $45.2 billion in equity value.

Also read: Consumer Groups Quick to Warn Against Comcast Deal to Buy Time Warner Cable

The deal comes soon after Time Warner Cable fended off a bid from Charter Communications.

Comcast will gain a net of 8 million managed subscribers, bringing its total to 30 million — just under 30 percent of the total number of video subscribers in the U.S. As of December, Comcast had 53 million subscribers for all of its services, including Internet.

Though Comcast will take on TWC's approximately 11 million managed subscribers, it will divest 3 million to address competitive concerns. The deal has already drawn fire from some consumer groups, who say the deal will kill competition and hurt consumers. Fighting for federal approval is nothing new to Comcast, which completed its acquisition of NBC just over three years ago after a lengthy quest for FCC approval.

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The deal gives Comcast ownership of TWC's cable systems in key markets, including New York City, Southern California, Texas, the Carolinas, Ohio, and Wisconsin.

“The combination of Time Warner Cable and Comcast creates an exciting opportunity for our company, for our customers, and for our shareholders,” said Brian L. Roberts, Comcast's chairman and CEO. “In addition to creating a world-class company, this is a compelling financial and strategic transaction for our shareholders.

He also said Comcast plans to expand its buyback program by an additional $10 billion at the close of the transaction.

Also read: Time Warner Cable, This Is Why People Get Mad at You (Opinion)

“This combination creates a company that delivers maximum value for our shareholders, enormous opportunities for our employees and a superior experience for our customers,” said Robert D. Marcus, chairman and CEO of Time Warner Cable. “Comcast and Time Warner Cable have been the leaders in all of the industry's most important innovations of the last 25 years and this merger will accelerate the pace of that innovation.”

The new cable company will be led by Comcast Cable President and CEO Neil Smit.

Time Warner Cable will combine its products and services with Comcast's, including StartOver, which allows customers to restart a live program in progress, and LookBack, which allows them to watch shows up to three days after they air, without a DVR.

The companies promised the deal would also bring customers new innovations, including a superior video experience, higher broadband speeds, and the fastest Wi-Fi.

Under the terms of the deal, each Time Warner Cable share will be exchanged for 2.875 shares of Comcast, equal to Time Warner Cable shareholders owning roughly 23 percent of Comcast's common stock. The value to Time Warner Cable shareholders will be approximately $158.82 per share, based on the last closing price of Comcast shares.

 

  • Cyclops

    No. No. No. No. No. NO. No. No. No. No.

    • Elitism_FIghter

      Hate success and worship failure, Communist homosexual? Maybe if you got off your lazy butt like Brian Roberts and worked for a living, you'd be successful, too. If you don't like free enterprise, GET THE HELL OUT OF MY AMERICA AND GO SEE YOUR BUDDY FIDEL IN HAVANA! NOW!

      • Cyclops

        I love free enterprise. I hate monopolies. Monopolies remove choice and the free from free enterprise. I do work and I work hard. I want to be able to have a choice where I spend my hard earned dollar. This removes choice.