Time Warner Cable (TWC) has leaped into the arms of Charter Communications in a merger valued at $55 billion, confirming previous rumors. That's considerably more than the $45 billion Comcast proposed to pay for TWC in a controversial deal that was eventually called off. Charter said that the merger will "create a leading broadband services and technology company serving 23.9 million customers in 41 states." Time Warner Cable rejected a similar offer back in 2014, but Charter sweetened it considerably this time around with an offer that values it at $75.7 billion.
TWC is the nation's second largest cable operator after Comcast, while Charter Communications sits in fourth place. The terms of the deal mean that Charter would also absorb Bright House Networks, a smaller US operator. Charter said that the deal would result in "faster broadband speeds" and "more competition for consumers and business," even though there would be fewer players in the market. If the whole thing comes off, Charter would be the nation's second largest operator with 24 million customers, compared to 27 million for Comcast.
However, the deal still needs to be approved by regulators, and the FCC was reportedly dead set against Comcast's acquisition of TWC. That said, FCC Chairman Tom Wheeler had already told TWC that he wasn't necessarily against any future deals with other players, according to the WSJ. There's a big difference betwen the Charter and Comcast mergers, because the latter would've created a single dominant company and left many consumers with only one option for cable and internet. The sheer size of it could still be a concern, however, and if the deal doesn't come off, Charter could end up owing its larger rival nearly $2 billion in cancellation fees.
"This deal makes all the sense in the world," Comcast CEO Brian Roberts said in a statement this morning. "I would like to congratulate all the parties."