Sources tell Reuters that a major cable TV merger may be in the works. Time Warner Cable (TWC) and Charter Communications (CHTR) are reportedly in talks about a possible deal to combine their businesses.
The new talks follow discussions earlier this year about a potential deal. Liberty Media Corp. (LCMA), which controls Charter, is said to be driving the idea. Time Warner Cable has signaled that it might consider a merger, if the price is set high enough.
Structuring the deal to appeal to Time Warner shareholders will be critical if the bid is to succeed. Charter is said to have retained advisors to guide a potential proposal.
Charter, the fourth largest cable TV provider, has a current market capitalization of about $13 billion, while Time Warner Cable, which is the second ranked U.S. cable service, is worth about $34 billion. Charter has four million subscribers, compared to 12 million for Time Warner.
Time Warner CEO Glenn Britt is stepping down this year.
Shares of Charter fell more than 1% in Monday trading, while Time Warner slipped modestly.