Comcast Corp. agreed to buy Time Warner Cable for about $45.2
billion in stock, in a deal that would combine the nation's two
biggest cable operators.
The boards of both companies have approved the transaction,
which was announced Thursday morning.
By negotiating the deal, Comcast Chief Executive Brian Roberts
ensures his dominance of the U.S. cable industry will be
maintained. But the transaction is expected to face a lengthy
regulatory review.
Comcast and Time Warner Cable executives are hosting a
conference call with investors at 8:30 a.m. Eastern Time to discuss
the deal. Stay tuned to MoneyBeat for the live play-by-play of the
call.
8:53 am | by Steven Russolillo
With divestitures, Comcast will own or manage less than 30% of
the cable market. That's about the same share as post AT&T and
Adelphia transactions, which Mr. Cohen notes took place in "a much
more competitive market." The proposed transaction won't reduce
competition in any relevant market, he added.
8:53 am | by Sarah Krouse
Cohen says the deal will create a "much more effective
competitor in the advertising market" and lead to greater broadband
competition and adoption.
8:52 am | by Steven Russolillo
Any legitimate concerns are addressed by the highly competitive
market, Mr. Cohen said. "This is simply not a horizontal merger."
He points out that Comcast and Time Warner Cable don't compete in a
single zip code in America.
8:50 am | by Steven Russolillo
On to the regulatory discussion. Comcast Executive Vice
President David Cohen reiterates that the deal is "pro consumer,
pro competitive, strongly in the public interest and
approvable."
8:49 am | by Steven Russolillo
Comcast CFO Michael Angelakis says the company will expand its
existing stock buyback plan by an additional $10 billion upon
closing of the deal.
8:44 am | by Sarah Krouse
Time Warner Cable chief executive Rob Marcus saidas difficult as
it is to cede control of a business, "in this case it just makes
too much sense". He added that the deal feels natural to him.
"Much as I would have relished the opportunity to let my team
seize the opportunity ahead, I believe that my customers and yours
stand to benefit tremendously," he said.
8:43 am | by Steven Russolillo
Time Warner Cable says it will suspend its buyback, but will
keep paying a dividend.
8:43 am | by Steven Russolillo
Time Warner Cable CEO Rob Marcus notes it's always difficult to
cede control. That said, this deal "just makes too much sense."
8:41 am | by Steven Russolillo
Mr Roberts said the two companies have operating efficiencies of
$1.5 billion, meaning COmcast is paying 6.7 times EBITDA for a
cable company that operates in premier markets "which we are very
bullish."
8:37 am | Competition | by Steven Russolillo
Mr. Roberts comments on regulatory issues, saying this
transaction is "approvable." It says it is "pro consumer, pro
competitive and strongly in the public interest." He said the deal
will benefit millions of customers through technological
advancements and innovative products.
He also said it won't reduce competition in any relevant market,
as both Comcast and Time Warner Cable don't compete in any of the
same markets.
8:36 am | by Sarah Krouse
Mr. Roberts calls the deal "pro-consumer, pro-competitive and
strongly in the public interest." He adds that the two companies do
not operate in any of the same zip codes.
8:34 am | by Steven Russolillo
Comcast CEO Brian Roberts jumps on the call, decribing this as a
"very exciting day" for the company. He said he had been evaluating
this deal "for some time now."
8:33 am | No Breakup Fee? What? | by Maureen Farrell
Time Warner Cable's CEO told CNBCThursday morning that the deal
does not contain a breakup fee?
That's surprising in most deals but particularly one with this
many potential regulatory potholes.
At first blush because ofthe high price tag,this deal look like
a huge win for Time Warner Cable, and should it pass regulatory
muster, it still should be.
But as Andrew Ross Sorkin noted on CNBC Thursday after asking
that question of Rob Marcus without a breakup fee, Comcast in many
ways has the "option" to buy Time Warner Cable.
Look for more on this on the call.
8:29 am | by Steven Russolillo
We're two minutes away from the beginning of the call. Time
Warner Cable shares are spiking premarket, up to $149.73 from
Wednesday's close of $135.31. Comcast is down a little. Stay tuned
for the call.
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