Feb 13 (IFR) - The cost of insuring Time Warner Cable's
debt against default fell sharply Thursday on news that
Comcast Corp will buy the company for USD45.2bn.
TWC's five-year credit default swaps (CDS) tightened 107bp
to 74bp, while the company's bonds also rallied.
One banker said TWC's 4.5% 2042 bonds were trading at a
G-spread of 155bp from around 275bp before the Comcast news
broke late on Wednesday.
Time Warner Cable bonds have been trading more like a junk-
rated company due to speculation that Charter Communications
would buy the business instead and load it up with
"Comcast is investment-grade, so this is good news for TWC
bondholders," said the banker.
The all-stock deal combines the two largest US cable
operators. The friendly takeover comes as a surprise after
months of public pursuit of Time Warner Cable by smaller rival