Time Warner Cable Rejects Charter Take-Over Bid

Time Warner Cable Inc. rejected an acquisition offer from Charter Communications Inc. valued at more than $61 billion including debt, spurning the biggest unsolicited takeover bid since 2008, according to Bloomberg.

Time Warner Cable Chief Executive Officer Rob Marcus called the $132.50-a-share bid a “low-ball offer." The proposal included about $83 cash per share and about $49.50 in stock, according to Charter. Excluding debt, the deal would be worth about $37.3 billion.

Charter, backed by billionaire John Malone, is seeking to create a provider of TV, Internet and phone service for about 20 million subscribers in 38 states. The combined company would be the third-largest pay-TV operator by customers -- behind Comcast Corp. and DirecTV -- helping it generate cost savings and negotiate better programming deals.

Charter Logo

Time Warner Cable’s board rejected Charter’s offer, calling it “grossly inadequate,” according to a statement yesterday. Marcus said the company is open to a deal with Charter for $160 a share, or $100 in cash and $60 in Charter common stock.

“Here’s what happened: We didn’t put our house up for sale, and we got a knock on the door and someone made a low-ball offer,” Marcus said in an interview. “They want a premium asset at a bargain-basement price, and that’s just not going to happen.”

Time Warner Cable probably won’t accept an offer less than around $150 per share, Christopher King, a Baltimore-based analyst with Stifel Nicolaus & Co., wrote in a note to clients.

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