Time Warner Cable said late Monday its board of directors "had unanimously rejected a third grossly
inadequate proposal" by Charter Communications Inc. Earlier today,
Charter Communications, the fourth-largest U.S. cable
operator, had formally made a bid for Time Warner Cable, the second-largest U.S. cable operator, for a massive $61.3 billion in cash and stock.
The bid, first reported by
, had been expected for months.
The deal was valued at about $132.50 a share -- with Time Warner shareholders receiving $83 cash per share and $49.50 in Charter stock.
Excluding debt, Charter would have paid about $37.3 billion under the terms of the deal.
According to reports, Tom Rutledge, president/chief executive officer of Charter, said Time Warner
had not initially offered a “serious response." Charter had approached Time Warner informally in December, according to Bloomberg
, but was rejected.
Charter’s stock closed on the day down 1.6% to $134.22; after-hours trading witnessed the stock rising 1.7% higher to $136.50. Time Warner Cable stock closed down 0.7% to $132.40. After-hours
trading of Time Warner Cable rose 1.7% to $134.51.
John Malone, chairman of Liberty Media, which is a major shareholder in Charter, had been pushing for consolidation of the cable industry
-- and a takeover of Time Warner -- to combat growing digital media competition.
Time Warner Cable has about 12 million video customers in major markets such as New York, Los Angeles and
Dallas. Charter has around 5.7 million video customers. The deal would have created a company of about 20 million customers in 38 stations providing TV, broadband and phone service.