Time Warner Cable Rejects $61 Billion Takeover Bid As Grossly Inadequate
Published on: 14th Jan 2014
Note -- this news article is more than a year old.
By: Ian Mansfield
USA based Time Warner Cable has rejected a takeover bid offer from its rival Charter Communications that valued the company at around USD61 billion as "grossly inadequate".
It transpires that this the third attempt by Charter to buy the company, and said that it was going public with the latest offer due to what it said was a lack of interest from TWC's management.
Charter had previously offered cash and stock nominally valued at approximately $114 in June and approximately $127 in October. It is now offering US$132.50 per share, consisting of $83.00 in cash and $49.50 in Charter stock.
Rob Marcus , Time Warner Cable's Chairman and CEO said that "Not only is the nominal valuation far too low, but because a significant portion of the purchase price would be in Charter stock, the actual value delivered to TWC shareholders could be substantially lower given the valuation, operational, and significant balance sheet risks embedded in Charter's stock."
Marcus did however say that they would be willing to accept a price of $160 per TWC share, consisting of $100 in cash and $60 per share of Charter common stock.
The accused Charter of going public with its lower offer in order to pressure the management into accepting the deal.
Charter with 4.2 million customers is the country's fourth largest cable networks, while TWC with 11.4 million customers is the country's second largest.