Light Reading

Charter Seeks to Replace TWC Board

Alan Breznick
2/11/2014
50%
50%

Raising the stakes in its takeover bid for Time Warner Cable, Charter Communications has proposed a full slate of new directors for the TWC board. But TW Cable's management has once again rejected the move.

Charter Communications Inc. , which has been pressing Time Warner Cable Inc. (NYSE: TWC) to engage in serious merger negotiations for months, unveiled its 13 nominees to replace the entire TWC board in a press release Tuesday morning. Although the TW Cable annual meeting will not be held until later this year, Charter faced a Feb. 15 deadline to nominate new directors to the TWC board.

Most notably, Charter's lineup of 13 nominees includes TW Cable's former CTO Jim Chiddix and Charter's own former CTO Marwan Fawaz. Two other prominent, long-time cable executives on the list are former Virgin Media Inc. (Nasdaq: VMED) CFO Eamon O'Hare and former Cablecom CEO Bruno Claude.

In the press release, Charter CEO Tom Rutledge made it clear that his company is proposing the slate to bring TW Cable's management to the negotiating table:

    It is clear from our meetings with Time Warner Cable shareholders that there is an overwhelming desire to combine these two companies to increase Time Warner Cable's competitiveness, grow market share, and create shareholder value. Our purpose in this proxy contest is to enable shareholders of TWC to raise their voice and to provide a very capable board who will hear them.

But, just as it has repeatedly done before, TW Cable's management quickly dismissed the latest Charter ploy. TWC CEO Rob Marcus said in his own prepared statement:

    It is clear that Charter is nominating a slate of directors for the sole purpose of pressuring our Board into accepting the same lowball offer that it previously considered and unanimously rejected. Our board remains focused on maximizing shareholder value. We are confident in our strategic plan, which was detailed publicly on January 30, and we are not going to let Charter steal the company. (See TW Cable Strikes Back.)

In another notable gambit in the escalating proxy war between the second and fourth biggest US MSOs, Charter proposed that the size of TWC's board be fixed at its current 13 members. In addition, Charter wants TWC shareholders to "repeal any amendments to the bylaws that were adopted" by the TWC board without shareholder approval after July 26, 2012, the date of the last public amendment to the TWC bylaws.

Although some investors and industry analysts had thought that Charter might again raise the price of its takeover bid to woo TWC shareholders, the company made no move to do so on Tuesday. Instead, Charter is apparently standing pat on its third and latest offer of $132.50 per share in cash and Charter stock. TWC officials have said they won't accept anything less than $160 per share for their company's stock. (See Charter's $61.3B Bid for TWC Rebuffed Again.)

Charter also made no mention of its reported negotiations with Comcast Corp. (Nasdaq: CMCSA, CMCSK) to split the TW Cable's spoils if Charter's hostile takeover attempt succeeds. Under that proposed pact, Comcast would receive TWC's New York City, New England, and North Carolina cable system clusters in exchange for up to $16 billion in cash. (See Comcast May Join Charter Team.)

— Alan Breznick, Cable/Video Practice Leader, Light Reading

(7)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
pcharles09
50%
50%
pcharles09,
User Rank: Light Beer
2/28/2014 | 8:59:41 PM
Re: Great idea!
I honestly don't think it's a good thing for the consumer. I recently moved to Queens & got TWC. In the 6 months I've had their service, the prices have been boosted 3 times.

They claim their infrastructure needs updating & the TV networks are charging them more.

If I had a real alternative, I would've switched by the 2nd increase.
albreznick
50%
50%
albreznick,
User Rank: Blogger
2/28/2014 | 5:02:03 PM
Re: Great idea!
So now we're going to see the top 2 cable cvompanies merge instead. Think that's better or worse than TWC and Charter getting together? I'm reallly not sure either way.
Phil_Britt
50%
50%
Phil_Britt,
User Rank: Light Sabre
2/12/2014 | 5:10:23 PM
Money Talks
Charter's offer isn't much above where Time Warner's stock was when the first inklings of a potential offer started hitting various news organizations. While Time might ultimately take less than the $160 a share it has set as its limit, Charter's offer is far too low at this juncture for Time Warner to really consider it.

That could change if the market crashes or if Time's Warner's next earnings show a bigger than expected loss. But even without rival bids, Charter will likely have to sweeten the pot quite a bit for the deal to happen -- and that's if the Justice Department agrees to it.
TaraSeals
50%
50%
TaraSeals,
User Rank: Light Sabre
2/12/2014 | 3:41:14 PM
Getting persnickety
The rhetoric going back and forth in this deal entertains me to no end. Charter is much smaller and the deal will be highly leveraged, funded primarily with debt, and it's still recovering from its bankruptcy past, and yet it's swinging the big verbal guns when it comes to characterizing TWC's overall health. It's all "failed operational strategy" this and "TWC is in need of a transformational event" that, even though the Q4 financials weren't that bad. OK, subscriber drain on the video side was horrendous, but overall--it's not looking like a consumption victim in Victorian England just quite yet. And as your own Dan O'Shea pointed out, when it comes to broadband, which is really the future, it's got some assets to talk about.

At the same time, I'm rooting for Charter-mostly because I really don't want to see Comcast--which TWC has been in talks with as well--get any bigger. 

And, the idea of hijacking the board is so 1980s corporate raider awesome on some levels. We'll see if shareholders take the bait. 

There's always the middle path too, where Charter and Comcast split TWC's baubles...

 

 
pcharles09
50%
50%
pcharles09,
User Rank: Light Beer
2/11/2014 | 10:53:05 PM
Re: Great idea!
I agree. Especially in major metropolitan areas where you get squeezed into only 1 or 2 choices because of zoning.
Mitch Wagner
100%
0%
Mitch Wagner,
User Rank: Lightning
2/11/2014 | 6:59:29 PM
Great idea!
"I'd love it if a couple of the cable companies merged. There needs to be less choice for cable and Internet service," said nobody never.
KBode
50%
50%
KBode,
User Rank: Light Sabre
2/11/2014 | 5:26:28 PM
Patty cake
I kind of wish that we could fast forward through this patty cake mating dance and just get a deal done. I assume Time Warner Cable will bend at $150 per share?
From The Founder
Light Reading sits down at CES with the head of Cisco's service provider video business, Conrad Clemson, to discuss how NFV and cloud security relate to video, the challenge of managing 4K/8K traffic, the global expansion of Netflix and virtual reality.
Flash Poll
Live Streaming Video
CLOUD / MANAGED SERVICES: Prepping Ethernet for the Cloud
Moderator: Ray LeMaistre Panelists: Jeremy Bye, Leonard Sheahan
LRTV Custom TV
Hosting in Ireland, Past & Present

2|10|16   |   16:07   |   (0) comments


Garry Connolly, president of Host in Ireland, presents the keynote at Light Reading's 2020 Vision Executive Summit in Dublin.
Women in Comms Introduction Videos
What's Hot in Mobile Commerce?

2|10|16   |   12:18   |   (1) comment


Claire Maslen, financial services relationship manager at the GSMA, talks about the development of the digital commerce sector and the types of relationships that mobile operators are developing to further their m-commerce strategies.
LRTV Documentaries
EANTC Tests Nokia IP Routing & Mobile Gateway VNFs for Real World Deployment

2|9|16   |   5:08   |   (1) comment


Nokia obtained validation of its virtualized router and virtualized mobile gateway capabilities through rigorous testing performed by EANTC. The results set a new industry benchmark for outstanding performance, scalability, resiliency and manageability. Nokia VNFs are ready for telco cloud deployment, so that service providers can accelerate mobile, business and ...
Between the CEOs
CEO Chat With Level 3's Jack Waters

2|8|16   |   26:15   |   (1) comment


Light Reading CEO and founder Steve Saunders sits down with Level 3 Communications' CTO Jack Waters to discuss hot topics like virtualization, 4K and the future of telecom...
LRTV Custom TV
The Composable Telco

2|8|16   |   24:46   |   (0) comments


Heavy Reading's Principal Analyst Caroline Chappell presents the keynote at Light Reading's 2020 Vision Executive Summit in Dublin.
LRTV Custom TV
Join Us at the Digital Operations Transformation Summit

2|4|16   |   03:52   |   (0) comments


The Digital Operations Transformation Summit on February 21, 2016 at the Crowne Plaza Barcelona Fira Centre will bring together 50 senior executives to engage in a unique debate on the opportunities and challenges presented by the transformative evolving digital landscape. RSVP now at events@lightreading.com.
LRTV Custom TV
Making the Test: ADVA Ensemble Connector vs. Open vSwitch

2|4|16   |   01:28   |   (0) comments


Light Reading, in partnership with EANTC, recently tested ADVA's Ensemble Connector, which replaces open vSwitch and offers carrier-grade capability and interoperability. The test results strengthen ADVA's credibility as a provider in the virtualization space.
LRTV Custom TV
Bridging the Gap Between PoCs & Deployment in NFV

2|4|16   |   31:50   |   (0) comments


Charlie Ashton of Wind River presents the keynote at Light Reading's 2020 Vision executive summit in Dublin.
Between the CEOs
CEO Chat With Mike Aquino

2|3|16   |   17:34   |   (0) comments


The former CEO of Overture Networks, Mike Aquino, discusses why truly open virtualization solutions provide service providers with the greatest choice.
Shades of Ray
MWC: Buckle Up for 5G & the IIoT

2|2|16   |   02:28   |   (0) comments


This year's Mobile World Congress looks set to be a 5G land grab and a chance to get down and dirty with the Industrial Internet of Things (IIoT) – but what will the 5G discussions actually be about?
LRTV Custom TV
Case Study: Building China's Next-Gen TV Networks

2|2|16   |   5:01   |   (0) comments


With over 2 billion viewers worldwide, Shenzhen Media Group is one of China's largest content producers. By partnering with Huawei and Sobey, SZMG was able to modernize media operations with the Converged News Center, a production studio that is a model for next-generation workflows.
LRTV Custom TV
Quad Channel Modulator Driver with 46 Gbaud Capability from MACOM

1|28|16   |     |   (0) comments


MACOM's MAOM-003427 is the industry's first surface-mount modulator driver with 46 Gbaud capability to support next generation 200G and 400G applications.
Upcoming Live Events
March 10, 2016, The Cable Center, Denver, CO
April 5, 2016, The Ritz Carlton, Charlotte, NC
May 23, 2016, Austin, TX
May 24-25, 2016, Austin Convention Center, Austin, TX
All Upcoming Live Events
Hot Topics
Google's 5G Radio Ambitions Are Expanding
Dan Jones, Mobile Editor, 2/5/2016
Cincinnati Bell Joins Weight Watchers Club
Alan Breznick, Cable/Video Practice Leader, 2/5/2016
Yahoo & Verizon Sitting in a Tree...
Brian Santo, Senior editor, Test & Measurement / Components, Light Reading, 2/8/2016
Vodafone: Flexible Work Policies Boost Profits
Sarah Thomas, Editorial Operations Director, 2/8/2016
It's Time to Integrate OTT Video
Alan Breznick, Cable/Video Practice Leader, 2/8/2016
Like Us on Facebook
Twitter Feed
Webinar Archive
BETWEEN THE CEOs - Executive Interviews
Light Reading CEO and founder Steve Saunders sits down with Level 3 Communications' CTO Jack Waters to discuss hot topics like virtualization, 4K and the future of telecom...
The former CEO of Overture Networks, Mike Aquino, discusses why truly open virtualization solutions provide service providers with the greatest choice.
Animals with Phones
Retro Is the Way to Be Click Here
Some animals are too cute for smartphones.
Live Digital Audio

Broadband speeds are ramping up across Europe as the continent, at its own pace, follows North America towards a gigabit society. But there are many steps to take on the road to gigabit broadband availability and a number of technology options that can meet the various requirements of Europe’s high-speed fixed broadband network operators. During this radio show we will look at some of the catalysts for broadband network investments and examine the menu of technology options on offer, including vectoring and G.fast for copper plant evolution and the various deployment possibilities for FTTH/B.