Charter-Comcast deal could push Time Warner Cable to accept acquisition bid

Charter Communications (Nasdaq: CHTR) reportedly has reached out to fellow MSO Comcast (Nasdaq: CMCSA) in an effort to complete its acquisition of Time Warner Cable (NYSE: TWC) in a move that could essentially put the nation's second largest MSO between a rock and a hard place.

Such a deal, as reported by Bloomberg, could overwhelm Time Warner's resistance to Charter's $37.4 billion bid because it would be obvious that Comcast has no interest in stepping in and bidding higher. Charter, reports have said, would like buy TWC's cable business for $132.50 per share. Its latest plan is to then sell off the New York City, North Carolina and New England cable assets to Comcast.

The agreement between Comcast and Charter is, at least for now, fluid and would supposedly depend on what Charter eventually ends up paying for TWC. If it goes through, Comcast would add 3 million subscribers, including the big-name New York City franchise area.

Charter's largest shareholder, cable icon John Malone, and Comcast Chairman Brian Roberts both share a vision of a more consolidated cable industry. Thus, a deal that devours, then shares the nation's second largest MSO would make sense from their perspectives.

For its part, Charter has been on an expansion push. Last year, the nation's fourth largest MSO grabbed Cablevision's (NYSE: CVC) Optimum West assets for $1.63 billion. Charter is also apparently confident enough that it can acquire TWC that it has already picked future directors that it would nominate to Time Warner Cable's board in early-to-mid February. That's further indication that Comcast is not sharing in the acquisition bid, but only picking up pieces from the new Charter.

For more:
- Bloomberg has this story

Related articles:
Rumor mill: Charter pushes Comcast-Cablevision scenario, proxy battle to nail Time Warner Cable deal
Charter, Time Warner Cable investor T. Rowe Price reportedly urges TWC to negotiate deal
Malone: Charter-TWC deal needed to attract developers, innovators to cable industry

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