John Malone-backed cable group Charter is poised to win the race to snap up media giant Time Warner in a $55.1bn deal to create America’s second largest cable and broadcasting company. The billionaire executive, who chairs Liberty Global, has helped engineer a $195 a share stock and cash deal for Time Warner. The takeover, which could be announced as soon as today, will see Charter – 25 per cent owned by Malone’s Liberty Media group – combine with Time Warner and cable provider Bright House Networks, to create a challenger to industry leader Comcast. Terms of the deal include a option of $100 in cash and $95 in Charter shares, or $115 in cash and $80 in shares. Shareholders will need to approve any deal. A $2bn break fee has also been included, a sign of the wariness that both sides exhibit over competition concerns from US regulators. An agreement would end Malone’s long running pursuit of Time Warner, which has been a long-standing takeover target for media companies. Time Warner struck a deal with Comcast in April 2014 – beating out Charter – but US competition authorities indicated they would not back a deal, ending the chances of a tie-up. French cable firm Altice, guided by billionaire rival Patrick Drahi, has also made a move for Time Warner and had built a substantial warchest to fund to takeover. The company could still move to mount a counterbid against Charter. Charter’s bid of $195 a share is 14 per cent higher than Time Warner’s closing price on Friday night. US markets were closed yesterday for a public holiday. Terms of the deal were first reported by Bloomberg.
Monday 25 May 2015 11:32 pm
Malone-backed Charter swoops for Time Warner