TWX Time Warner Inc. New

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)

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