AfterDawn: Tech news

Comcast and Time Warner spent over half a billion on failed merger

Written by Andre Yoskowitz @ 04 May 2015 10:00 User comments (2)

Comcast and Time Warner spent over half a billion on failed merger According to Comcast's most recent earnings report, the cable giant has spent over $330 million in 'transaction-related costs' in its attempt to acquire Time Warner Cable, and Time Warner has spent over $220 million.
Comcast proposed to buy TWC in February 2014 for $45.2 billion and just canceled the proposed merger last month after it became clear it would never make it through Federal regulators.

In the Q1 alone, ended March 31st, Comcast had $99 million in costs related to the acquisition, and Time Warner Cable had $24 million in costs.

"The costs are mainly for legal fees and outside consulting firms--everything from Human Resources and IT consulting to banks and management consulting services," said Comcast VP of Government Communications Sena Fitzmaurice. "Communications and lobbying fees would be included--however, what is included has to be direct and incremental--so only those fees that are directly and incrementally associated with the deal."

At least there was one positive for Comcast shareholders: no break-up fee. The company says the deal was structured without an expensive break-up fee involved, which can sometimes reach into the billions. One recent example is AT&T's failed purchase of rival carrier T-Mobile in 2011. When the DOJ killed the merger, AT&T had to pay T-Mobile $4 billion in cash and spectrum, effectively reviving the carrier and allowing it to go on the offensive with pricing.


Previous Next  

2 user comments

15.5.2015 12:02

No sympathy, NONE for these jagoff companies!

First off, I said from the first article written that this ain't goin' thru!!! DOJ will stop this in a heartbeat. And again...I was right!

It's an unfair, competition-squashing buyout and anyone with half a brain said this wasn't going through.

What pisses me off to no end is the money wasted and I only need like 10 or 20 grand to free me financially for a while, yet these bastards wasted a half billion in an attempt to complete a merger they FRAKKING KNEW WOULDN"T GO THROUGH! They merely "hoped"

This is very much like the ATT/Tmobile merger. Except theirs wasn't nearly as competition-stifling as this would have been. Neither should be allowed. Finally! The U.S.A. is doing right by ourselves.

25.5.2015 15:29

Both companies will have to raise their prices to offset the costs of the failed merger. The consumer always gets the short end of the stick.

Comments have been disabled for this article.

News archive