Charter reportedly spurned $100B-plus offer from Verizon

Lowell McAdam Verizon
Verizon chief Lowell McAdam, who has said a team-up with Charter Communications makes "industrial sense."

Facing a slowdown in mobile phone sales and looking to keep pace with rival AT&T, Verizon reportedly made an offer for Charter Communications worth more than $100 billion, but the bid was rejected, according to an account in the New York Post.

The paper, citing multiple unnamed sources, said Charter turned it down because it was too low, and it also wasn't ready to sell. In recent months, Charter shares have spiked at times when speculation of a Verizon deal mounted—but many analysts have poured cold water on the prospects.

Liberty Media, which owns a large but non-controlling stake in Charter, also fielded interest from Verizon in Sirius XM, the satellite radio company, according to the Post. But that interest didn't progress to a formal offer either.


Like this story? Subscribe to FierceVideo!

The Video industry is an ever-changing world where big ideas come along daily. Cable, Media and Entertainment, Telco, and Tech companies rely on FierceVideo for the latest news, trends, and analysis on video creation and distribution, OTT delivery technologies, content licensing, and advertising strategies. Sign up today to get news and updates delivered to your inbox and read on the go.

RELATED: Verizon M&A talk 'may be overblown,' analysts say

The operating environment for both Verizon and AT&T has shifted dramatically over the past year. Each giant is getting bigger—Verizon has acquired Yahoo, which it will merge with AOL when the Yahoo deal closes this month, and AT&T is set to add Time Warner to its stable once that $85 billion megadeal closes next year.

MoffettNathanson principal analyst Craig Moffett wrote a blog post (sub. req.) in January that dismissed the possibility of a Verizon-Charter deal. But he also acknowledged the rationale of attempting it.

“To be sure, we understand why Verizon would be interested,” Moffett wrote. “The next generation of wireless will be about small cells with small radii. And every one of those cells needs to be connected to a wire. That means lots and lots of wires. And Cable has the most wires.”

Another hurdle standing in the way of a deal, from Charter's perspective, is the potential tax implications. Liberty's chairman John Malone, the ultimate cable dealmaker, is famously averse to transactions that carry significant tax burdens and has been known to shuffle assets relentlessly in order to optimize his companies' tax obligations.

Article updated June 1 to correct information about Liberty's stake in Charter.

Suggested Articles

CBS and Viacom have officially set the executive team that will lead their digital services including CBS All Access, Showtime and Pluto TV.

The FreeWheel Council for Premium Video is calling for the adoption of a universal standard for managing cross-platform ad campaigns.

Roku is rolling out a discounted bundle deal for its users that buy both Showtime and Starz subscription streaming services on the Roku platform.