Almost immediately after the failure of the Comcast acquisition of Time Warner Cable came news that TWC’s original suitor, Charter Communications, was already knocking at the door looking to rekindle their romance. Today, the couple made it official with the news that Charter and TWC will walk down the aisle in a deal worth around $55 billion.
Charter is also continuing to move ahead with its planned acquisition of Bright House Networks.
If both deals are successful, the combined company would be second to only Comcast in terms of total cable and broadband customers in the U.S. According to Charter, this “New Charter” would serve 23.9 million customers in 41 states.
The merger would allow the two companies to fill in some blanks in geographic regions where they otherwise dominate the local markets.
TWC already blankets New York City and much of upstate NY. Adding Charter would fill in several markets in Connecticut and Massachusetts. Likewise, TWC is the dominant provider in North Carolina, so adding Charter’s customers and in South Carolina would provide more continuity for the company. Then there’s Los Angeles, where TWC is the prime pay-TV and broadband provider, but where Charter also controls a handful of small pockets of service.
“With our larger reach, we will be able to accelerate the deployment of faster Internet speeds, state-of-the-art video experiences, and fully–featured voice products, at highly competitive prices,” said Charter CEO Tom Rutledge, who will continue on in this top position of the merged companies.
The question is whether or not the FCC and Justice Dept. — both of which were primed to stop the Comcast deal — will give this merger the green light. FCC Chair Tom Wheeler recently stated that the Commission is not automatically going to work to block consolidation, and the two regulators are reportedly prepping to sign off on AT&T’s acquisition of DirecTV, so a Charter/TWC hookup is possible.
But, unlike the Comcast merger where no break-up money was involved, TWC will be due $2 billion from Charter if this deal falls through.