Comcast recently offered Warner Cable Inc. $45 billion for merger, this offer was soon abandoned by Comcast this Friday. The reason behind this abandonment was the concerns raised by U.S regulators; they said that if the deal is successful then Comcast is very likely to attain advantage in the market of TV and internet-based services.
After the deal is cancelled, now Time Warner Cable is looking forward to several other offers to be reaching its doorsteps. But Time Warner Cable has to think about the new emerging technology of satellite based TV, it is giving tough competition to the companies.
This deal faced a lot of criticism from different politicians, executives of namely media companies and some large consumer and industry groups have also criticized. The criticism was solely related to the problem that this deal will give total control over the American’s online activity and what they watch on TV. On the other hand, Comcast raised the argument that the merger would bring faster service and better video services to more Americans.
“The pressure to consolidate in a very competitive industry is going to continue,” Maxim Group analyst John Tinker said.
In the bidding held for Time Warner Cable last year Charter Communications had to face defeat, still the controlling shareholder which is Liberty Media Corporation has shown deep interest.
“We believe that TWC will get a bid from Charter in the next three months, which we expect to be lower than the market expects,” Needham analysts said in a note. The analysts said they expected the opening bid at $130 to $135 per share.
Last trade of Warner Cable shares was $152.52 with an increase of 2.5%, where Comcast move 0.15% up at $59.32. Looking at the Charter share we see that it went down by 0.8% at $182.18.
Federal Communications Commission Chairman Tom Wheeler said on Friday that the merger would have posed an “unacceptable risk to competition and innovation.”
U.S. Attorney General Eric Holder said the companies’ decision to abandon the deal was “the best outcome for American consumers.”
The collapse of the deal is a setback for Comcast Chief Executive Brian Roberts.
“Today, we move on,” he said in a statement.
