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Charter reportedly near deal to buy Time Warner Cable

Charter is courting Time Warner Cable again, this time offering $55 billion in cash and stock, according to the Wall Street Journal.

Charter Communications is said to be making another play for Time Warner Cable. CNET

Update, May 26 at 3:56 a.m. PT:On Tuesday morning, Charter announced deals to acquire Time Warner Cable and Bright House Networks.


Charter Communications is said to be taking another swing at Time Warner Cable.

Charter is near an agreement to acquire Time Warner Cable in a $55 billion deal that would make the cable operator one of the biggest US broadband and pay TV companies, according to a Wall Street Journal report Monday. Under terms of the cash and stock deal, Charter would pay $195 per share for Time Warner, sources told the Journal, a 14 percent premium over Charter's closing stock price Friday.

Charter is the fourth largest cable operator in the US with about 6.8 million subscribers in 29 states. Time Warner Cable is the second largest cable company in the US with more than 15 million subscribers to its services in 29 states. Among cable operators, the combined company would be second in size only to Comcast's 27 million subscribers.

The deal could be announced as early as Tuesday, the Journal reported. The deal is said to include an acquisition of fellow cable operator Bright House Networks, the sixth-biggest cable company in the US.

The effort marks the fourth time Charter has made a play for Time Warner. In January 2014, Charter offered to buy Time Warner for about $132.50 a share, putting the value of the deal at around $61 billion including debt. But Charter's overtures were rebuffed and its efforts derailed a month later when Comcast announced its intention to acquire Time Warner.

A merger between Comcast and Time Warner would have created a pay-television giant with about 30 million subscribers and control of over 50 percent of the broadband-Internet market. That much power in the hands of one company, critics argued, could have pushed costs for consumers higher, influenced the distribution of video content and hindered competition from Internet companies like Netflix that stream video over broadband networks.

Charter's interest in Time Warner is said to have been rejuvenated last month when Comcast terminated its plan to acquire Time Warner for $45.2 billion. The deal collapsed amid reports that the Justice Department staff, which looks at whether mergers violate antitrust laws, had concerns about the deal and were considering suing Comcast to stop the merger. John Malone, chairman of Liberty Media, which owns a large stake in Charter, said at Liberty Media's investor conference in November that he would try to acquire Time Warner Cable if the deal with Comcast fell through, according to reports.

A Charter representative declined to comment, while Time Warner did not respond to a request for comment.