Charter Completes Time Warner Cable Acquisition
May 18 2016 - 11:00AM
Dow Jones News
Charter Communications Inc. on Wednesday said it completed its
$55 billion acquisition of Time Warner Cable Inc., solidifying the
formation of a telecommunications behemoth that faced regulatory
hurdles and criticism from consumer groups.
The new Charter Communications is the second-biggest broadband
provider in the country, after Comcast Corp., and the third-largest
pay-TV company, serving more than 17 million video customers,
trailing AT&T Inc. and Comcast. As part of the transaction,
Charter also agreed to acquire smaller operator Bright House
Networks. That deal was also completed, Charter said Wednesday.
Stockholders of Time Warner, other than Liberty Broadband Corp.
and Liberty Interactive Corp., will receive $100 in cash and shares
of the new public parent company, equivalent to 0.5409 shares of
legacy Charter, for each share of Time Warner.
The company will be led by Tom Rutledge, chief executive of the
legacy company. He will serve as president, CEO and chairman of the
board, which will have 13 directors. The board will include seven
independent directors, two designated by Advance/Newhouse—the
former parent of Bright House—and three designated by Liberty
Broadband.
Last week, Charter got its final regulatory approval needed for
the transaction from the California Public Utilities
Commission.
Earlier this month, the Federal Communications Commission said
it had formally voted to approve the acquisition while imposing
tough operating restrictions on it. The conditions placed on the
merger will help mitigate threats to online video competition that
could be exacerbated by cable-industry concentration, officials
said.
Specific conditions will require some degree of "overbuilding"
of cable within other cable companies' territories, something the
industry traditionally hasn't been required to do.
The deal also compels the merged company not to impose
data-usage caps on customers for a number of years, and prohibits
use of pay-TV contract language that critics believe has made it
harder for media companies to offer content online.
Some consumer groups criticized the deal, but it drew less
concern than a similar proposed merger of Comcast and Time Warner
Cable last year. That deal fell apart amid regulators'
opposition.
"Current Bright House Networks and Time Warner Cable customers
won't see many changes right away, though in the coming months they
will begin to hear more from us about the Spectrum brand, and the
product improvements and consumer-friendly policies that come with
it," Mr. Rutledge said Wednesday.
Write to Anne Steele at Anne.Steele@wsj.com and John D. McKinnon
at john.mckinnon@wsj.com
(END) Dow Jones Newswires
May 18, 2016 10:45 ET (14:45 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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