Charter communications And Cox Communications, two of the largest cable companies in the United States, agreed to merge.
The agreement would be one of the most important in industry – and through American companies – in the past year.
The agreement values COX at 34.5 billion dollars on a business basis – made up of $ 21.9 billion in equity and $ 12.6 billion in net debt and other obligations – in accordance with the recent Charter business value based on 2025 generations adjusted before interest, taxes, depreciation and multiple amortization, according to a press release Friday.
Charter, the second largest cable company listed on the stock market behind Comcasthas increased by around 8% in prior trade to its previous fence of $ 419.57. Always directed in private by the COX family, COX is also among the largest cable suppliers.
The broadband industry has faced stormy competition from wireless competitors in recent years, because there has been an increase in alternative internet options such as 5G or the so-called fixed wireless. This follows the continuous loss of customers of the traditional cable television bundle.
Charter had 30 million high speed customers at the end of the first quarter, a decrease of 60,000 compared to the previous period. It had around 12.7 million cable television customers, with 181,000 losses during the quarter.
The cable cars began to rely on their mobile business to keep customers, and Charter was aggressive in its prices and its grouping of mobile lines. Charter said that it had 10.5 million mobile lines in the first quarter after reporting another quarter of growth.
The company provides its services in 41 states and is available for more than 57 million houses and businesses. As of March 31, Charter said he had a total of 31.4 million customer relations.
Christopher L. Winfrey, CEO of Charter Communications.
Gracieuse: Charter communications
COX Communications – A Division of Enterprises COX – is counting as the largest private -based company in the United States and has around 6.5 million total residential and commercial customers, according to its website.
The company's services are available for 7 million houses in 18 states, and said it had $ 12.6 billion in total income in 2020. COX began to offer a mobile in 2023.
At the end of the merger, Cox Enterprises will hold around 23% of the entirely diluted actions of the company combined in circulation, according to the press release.
The transaction will see the company Combined Change its name to Cox Communications in a year after the conclusion of the agreement. The charter spectrum, the brand on its cable, high speed, mobile and other services, will become the consumption -oriented brand of all customers.
The combined company will face the current charter seat in Stamford, Connecticut, although it will keep a significant presence in the Cox attachment base in Atlanta after the fence.
The CEO of the Charter, Chris Winfrey, will remain at the helm as president and chief executive after the closing of the agreement. Meanwhile, Alex Taylor, Chairman and Chief Executive Officer of Cox Enterprises, will become Chairman of the Board of Directors of the Combined Company. Another COX leader will join the Board of Directors and the COX family will have the right to keep two members of the board of directors.
The merger with Cox occurs months after Charter announced that it acquires Liberty Broadband in a stock agreement that simplifies the portfolio of the John Malone cable pioneer. In February, Charter and Liberty Broadband shareholders approved the proposed agreement.
Charter expects there to be around $ 500 million in annualized cost synergies within three years of the fence, according to the press release.
The merger agreement with COX should close at the same time as the merger of Liberty broadband, companies announced on Friday.
Disclosure: Comcast is the parent company of CNBC.