Comcast in talks with Charter over divestitures: source
(Reuters) - Comcast Corp (CMCSA.O) is in talks with Charter Communications (CHTR.O) over selling or spinning off roughly 3 million subscribers worth approximately $18 billion to $20 billion as part of the divestitures related to its $45.3 billion takeover of Time Warner Cable (TWC.N), according to a source familiar with the matter.
The talks center around either a straight sale of 3 million or so subscribers, or the potential creation of a spinoff in which Charter would buy a substantial minority stake, the source added.
There may be other options the two companies are discussing, the source said, adding that while the negotiations with Charter are serious, they are still in the early stages and could fall apart. Other cable companies also are interested in Comcast's divested subscribers, according to the source. The Financial Times first reported the news of the talks with Charter.
A Comcast spokesman declined to comment on Saturday while representatives for Time Warner Cable and Charter could not be reached for comment.
Executives from Comcast and Time Warner Cable earlier this month sought to reassure lawmakers that the merger between the two largest U.S. cable companies would not result in higher prices for cable TV and Internet packages.
Comcast already has pledged to divest 3 million subscribers to keep the combined company's subscriber base just under 30 percent of the U.S. pay television market.
The source said that the Comcast-Time Warner Cable deal has to be approved by regulators before any divestitures occur. However, Comcast could reach an agreement earlier with another cable company such as Charter, whose largest investor is John Malone's Liberty Media (LMCA.O), that would be contingent on the merger being approved by regulators.
The 3 million subscriber number could still change but, the source said, it would unlikely be as large as 5 million subscribers. The location of the subscribers in question was unknown.
The merged company would serve between 20 percent to 40 percent of high-speed Internet customers in the United States, Comcast has said in a Federal Communications Commission filing.
The House of Representatives Judiciary Committee is expected to hold a hearing on the deal early next month.
(Reporting Liana B. Baker and Michael Hirtzer; editing by Gunna Dickson)
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