Charter Communications to buy Time Warner Cable for $55bn

Charter Communications Inc – owned by media and telecoms investor John Malone – has made a $55bn cash-and-stock deal to buy Time Warner Cable Inc.

Including debt, the deal values Time Warner Cable at $78.7bn, and if it goes ahead would create the third and second largest cable operators in the US behind Comcast.

The combined firm will be a broadband services and technology company serving almost 24 million customers in 41 states.

Charter is also set to buy Bright House Networks, another cable operator, for $10.4bn.

The Time Warner Cable deal likely to come under regulatory scrutiny with the Federal Communications Commission (FCC) issuing a statement claiming it will review the deal in the public interest.

“In applying the public interest test, an absence of harm is not sufficient,” said FCC chairman Tom Wheeler. “The commission will look to see how American consumers would benefit if the deal were to be approved.”

A merger of Charter and Time Warner Cable, with other related deals, would create a company that controls more than 20% of the US broadband market, according to research firm MoffettNathanson.

Last month, after citing regulatory concerns, Comcast walked away from a deal to buy Time Warner Cable for $45bn.

Liberty Broadband, which currently owns about a quarter of Charter, is expected to own about 20% of the new company.