Comcast buys Time Warner Cable for $45 billion

Comcast has acquired Time Warner Cable for about $45 billion, creating a company that could control three-quarters of the US cable industry.

Comcast will pay about $159 per share for TWC in an all-stock deal.

The deal comes after Time Warner Cable rejected a $60 billion bid from Charter Communications last month, calling their offer “grossly inadequate”.

However, any merger is likely to face tight scrutiny from US regulators.

Time Warner Cable has been the subject of an eight-month takeover battle by smaller cable operator Charter Communications.

Comcast is the biggest cable television provider in the US and owns the NBC broadcast network, as well as the Universal film studio.

With 22 million of its own pay TV customers and Time Warner Cable’s 11 million, the combined entity will end up with about 30 million subscribers when the deal is complete.

Comcast argues that as it and Time Warner Cable serve different markets, their combination will not reduce competition for consumers.

Comcast operates mainly in the northeast, including its home town of Philadelphia and Boston, Washington and Chicago.

Time Warner Cable’s subscribers are centered around its New York headquarter, as well as Los Angeles, Dallas and Milwaukee.

In many of those areas, the new Comcast/Time Warner Cable group will face competition from rivals such as AT&T and Verizon.

However, Public Knowledge, a Washington-based consumer rights group, called on regulators to stop the deal.

It said the merger would give Comcast “unprecedented gatekeeper power in several important markets.”

Comcast and Time Warner Cable hope to make significant cost savings – of up to $1.5 billion in annual costs over three years, with half of that coming in the first year.