Charter Communications is working on submitting formal a bid for Time Warner Cable before 2014, “trying to devise a deal structure that would lure the No. 2 U.S. cable operator’s shareholders,” according to a Reuters story.
Liberty Media approached Time Warner Cable earlier this year about merging with Charter. Liberty Media agreed to buy about 27% of Charter for about $2.62 billion in March, helping Liberty re-establish itself as a player in cable TV. Charter is the eighth biggest pay-TV provider, with some 4.2 million video subscribers.
“Talks between the parties restarted over the past few days, according to a separate source close to matter, but Time Warner Cable’s management remains cool to the idea of a tie-up,” said the Reuters story. “Time Warner Cable, which earlier this week indicated that it was open to a deal at the right price, has a market value of more than $34 billion, compared with Charter’s market value of about $13 billion.”
“Charter is hoping that Time Warner Cable’s weak operating performance in the third quarter, in which it saw a fall in both TV and internet subscribers, would make the company more open to a bid,” sources told Reuters.