Time Warner Cable Inc (NYSE:TWC) Rejects Charter Communications Inc (NASDAQ:CHTR)’s Offer
Charter Communications, Inc. (NASDAQ:CHTR) had made a $61 billion takeover bid to buy out Time Warner Cable Inc (NYSE:TWC). Today, the number 2nd placed cable company which boasts of a market cap of $38.47 billion has officially rejected the buyout offer made by the smaller $13.99 billion market capped Charter Communication, which is currently placed 4th in the U.S cable players list.
Feels Offer Is Under Valued
In its announcement rejecting the offer, Time Warner Cable Inc (NYSE:TWC) termed Charter Communications, Inc. (NASDAQ:CHTR) offer as being a “grossly inadequate proposal”. Rob Marcus, the CEO of struggling Time Warner Cable Inc (NYSE:TWC) has been quoted by Reuters news agency has saying that, “In essence, these guys are just trying to get a premium asset at a bargain basement price. This makes the job of finding it off rather straightforward. Charter’s latest proposal is a non-starter. 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.”
Others In The Fray
Yesterday, Charter Communications, Inc. (NASDAQ:CHTR) had announced that it has valued each share of Time Warner Cable at $132.50. It has indicated that it will finance this deal by leveraging its cash and stock holdings amounting $37 billion and has also come forward to assume all the debt that Time Warner Cable Inc (NYSE:TWC) has accumulated over the years. The merger and acquisition moves kick started by Charter yesterday is expected to ignite a free for all, bidding war among the other strong cable players like Comcast and Cox Communications to buyout the ailing #2 cable operator in U.S.
Ball Back In Charters Court
CEO Marcus also threw the ball back into Charter’s quote by indicating that his firm would be willing to entertain offers which evaluate its stock at $160 share of which $100 should be paid out in cash and $60 would be accepted in the form of common stock of Charter.