US Cable giant Charter Communications turned down an offer to be acquired by Verizon for over $100 billion because the price was too low and Charter wasn’t ready to sell, New York Post reported.
News of the bid first emerged in January when it was said Verizon CEO Lowell McAdam made a preliminary approach to Charter and was working with advisers to tie-up two of the US’ largest telecoms and cable companies. Verizon submitted a bid of between $350 and $400 per share.
At the end of 2016 McAdam told Wall Street analysts the combination of telecoms and cable “makes industrial sense”.
According to the Post’s report, John Malone, chairman of major Charter shareholder Liberty Media, may have turned down the bid due to tax implications, and because he wanted to give Charter time to complete the integration of Time Warner Cable, which it acquired in 2016.
Verizon’s desire to move into cable follows recent deals made by rival AT&T, which is plunging billions into combining content with distribution.
It acquired pay-tv player DirecTV in July 2015, recently launched a new streaming service, and is currently looking to secure regulatory approval for an $85 billion acquisition of Time Warner (which is separate from Time Warner Cable).
According to the report, McAdam wants “something more transformative” such as a big cable deal, which would also boost its 5G plans through fibre optic networks operated by cable.
Verizon was also interested in another Liberty Media property, Sirius XM Holdings, but never got to the point of making a bid.
In early May, Comcast and Charter announced a partnership to cooperate on their respective entries into the country’s competitive mobile market.
Some sources think this was meant to garner a higher bid from Verizon as it could create a solid competitor to AT&T-Time Warner.