Time Warner Cable Receives $61 Billion Offer From Charter

Time Warner Cable Receives $61 Billion Offer From Charter

Around $61 billion was offered by Charter Communications in its bid to acquire Time Warner Cable that would combine two of the biggest cable companies in the US.

The offer included $37 billion in stock and cash while the reset would assume the debt of TWC. However, the offer was rejected by the board of directors of TWC. The bid was the biggest offer since the financial crisis. The offer is anticipated to start a bidding war among other cable companies like Cox Communications and Comcast.

Robert Marcus, CEO of TWC, said the value of the offer was low since it delivered a low value to shareholders of the company since a considerable part of the price are in the stocks of Charter, which would bring considerable risks to the balance sheet.

Marcus added a price of $160 for every share of Time Warner Cable would be acceptable if it consists of $60 worth of common stock share of Charter and $100 cash. TWC indicated that a previous offer from Charter in June was at around $114 for each share. Another bid was made in October worth $127 per share. The offers were rejected by the company.

Shares of TWC increased by 1.8 percent during after-hours trading at $134.84

The last six months saw the shares of the company increasing by around 15 percent with the number of companies aiming to acquire it. Tom Rutledge, CEO of Charter, said the company is making its latest offer public to bring it directly to the shareholders due to the reluctance of TWC in discussing a merger and the increase in the value of the stock of the company.

Rutledge indicated that commitment letters in a possible deal with Time Warner Cable can be signed within days and the financing for the transaction is ready.

Posted by James Fried on Thursday January 16 2014, 4:55 AM EST. Ref: USA Today. Link. All trademarks acknowledged. Filed under Featured News, Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0