Bloomberg: Comcast Nears Deal With Charter On Time Warner Cable Assets

(RTTNews) - Cable operator Comcast Corp. (CMCSA, CMCSK) is nearing a deal to buy some of Time Warner Cable Inc.'s (TWC) assets from Charter Communications Inc. (CHTR) if that company's shareholders approve Charter's takeover bid for Time Warner Cable, Bloomberg reported Monday, citing people with knowledge of the matter.

According to the Bloomberg report, Comcast's acquisition of Time Warner Cable's assets in New York City, North Carolina and New England would be contingent upon Charter's acquisition of Time Warner Cable.

A deal with Comcast would give Charter, the fourth-largest cable operator in the U.S., additional funds as well as remove a potential competitor in its attempt to buy Time Warner Cable.

In mid-January, Charter reportedly offered to acquire Time Warner Cable in a cash and stock deal valued at about $61.3 billion, including debt. Charter is said to have offered a price of $132.50 per share, including a cash component of about $83 per share and about $49.50 in Charter stock.

However, Time Warner Cable rejected the offer a day later, saying that the offer was "grossly inadequate."

Bloomberg reported that Comcast and Charter have a framework deal on the amount Comcast will pay for the cable assets in the three markets of New York City, North Carolina and New England. Time Warner Cable is said to have about 3 million subscribers in those three markets.

Comcast, the largest cable operator in the U.S., currently operates in 39 states. An acquisition of the Time Warner Cable assets would enable Comcast to cut costs as well as sell programming and advertising to larger swaths of people.

Bloomberg further reported that Charter will sell the three markets to Comcast in order to raise cash after borrowing about $20 billion to finance the acquisition of Time Warner Cable.

CMCSA closed Monday's trading at $52.49, up $0.09 or 0.17 percent on a volume of 18.97 million shares. In after-hours, the stock further gained $1.31 or 2.50 percent to $53.80.

CHTR closed Monday's trading at $136.92, up $5.50 or 4.19 percent on a volume of 4.42 million shares. In after-hours, the stock further gained $0.28 or 0.20 percent to $137.20.