Charter Communications is buying Bright House Networks in a deal valued at $10.4 billion as the cable industry continues to consolidate. Jeanne Yurman reports.
A major deal in the fast-consolidating cable industry is confirmed. The number four cable company Charter Communications is buying out the country's sixth largest Bright House Networks in a pact valued at $10.4 billion in cash and stock. The Bright House buyout adds 2.5 million subscribers to Charter's customer base and a much bigger footprint in Florida. Combined New Charter, as the merged companies will be referred to, will be the second largest cable operator in the US according to a press release. And it will be a partnership. Bright House based in Syracuse, New York is owned by publishing mogul S.I. Newhouse's Advance Publications and will continue to own just over 26 percent of the merged company. Charter, based in Stamford, Connecticut will own the rest. In a press release Charter's CEO, Tom Rutledge says, "Bright House Networks provides Charter with important operating, financial and tax benefits, as well as strategic flexibility. Bright House has built outstanding cable systems in attractive markets that are either complete, or contiguous with the New Charter footprint." Early trading reflected enthusiasm for the deal with shares of Charter rising more than seven percent. While the merger has been formally announced, Charter's acquisition of Bright House, is contingent on Comcast getting federal regulators' blessing to acquire Time Warner Cable.