NEW YORK (Reuters) - Comcast Corp’s proposed $45.2 billion merger with Time Warner Cable Inc would generate as much as $143 million in investment banking fees, providing a rare boon to Wall Street banks grappling with a dearth of large corporate takeovers.
JPMorgan Chase & Co, former top Morgan Stanley banker Paul Taubman and Barclays, which together advised Comcast, would split an estimated $51 million to $68 million in advisory fees if the proposed deal goes through, according to estimates by Freeman & Co LLC.
Financial advisers to Time Warner Cable - Morgan Stanley, Allen & Company, Citigroup Inc and Centerview Partners - are set to share $57 million to $75 million in fees, the estimates show.
However, a number of other banks backing a rival bidder, Charter Communications Inc, would likely miss out on the several hundred millions of dollars in potential fees.
Because Charter’s cash and stock offer for Time Warner Cable, unlike Comcast’s all-stock bid, involved a large borrowing, banks advising Charter could have earned more than $500 million in advisory and financing fees, according to Freeman & Co estimates in January.
Charter, which made a hostile $37.3 billion bid for Time Warner Cable, was working with Goldman Sachs Group, LionTree, Guggenheim Securities, Bank of America Merrill Lynch, Credit Suisse Group and Deutsche Bank.
The proposed combination between Comcast and Time Warner Cable is this year’s biggest transaction globally, and the largest since Verizon Communications Inc’s $130 billion deal last year to buy out Vodafone Group Plc’s stake in Verizon Wireless.
The deal is also yet another coup for Paul Taubman, who is advising key corporate clients on his own after leaving Morgan Stanley in early 2013. The former co-head of Morgan Stanley’s institutional securities unit left the Wall Street firm after it became clear that Chief Executive James Gorman planned to choose his long-time rival Colm Kelleher as the sole head of the unit.
Taubman was the No. 13 mergers adviser in 2013 globally thanks to his role advising Verizon on the buyout of the Verizon Wireless stake, putting him ahead of entire banks such as Evercore Partners, Moelis & Co and Jefferies in the coveted league table of financial advisers.
Reporting by Soyoung Kim in New York; Editing by Nick Zieminski