One of US cable’s biggest-ever merger is set to go ahead after the antitrust regulators okayed Charter Communication’s US$78 billion takeover of Time Warner Cable.
The Department of Justice said it had permitted the deal, and Charter’s related US$10.4 billion acquisition of Bright House Networks from Advance/Newhouse Partnership, with conditions.
Comcast was stopped from buying TWC in April last year, after heavy opposition to the deal.
The primary caveat of this week’s greenlight is the combined group will be forbidden to enter into or enforce agreements that make it harder for online video distributors such as Netflix to obtain content from vendors.
The Federal Communications Commission chairman Tom Wheeler will today circulate an order to greenlight the combined Charter-TWC-BHN group after agreeing the conditions of the deal will offset potential harm to online players.
The combined group would create the US’s second largest cable group and third-largest multi-channel video programming distributor, with an overall 17 million subscribers.
The DoJ noted TWC has been “the most aggressive MVPD” in securing clauses that prevent distributors from selling content to online video players.
Therefore, the ‘New Charter’ will be “prohibited from entering into or enforcing any agreement with a programmer that forbids, limits or creates incentives to limit the programmer’s provision of content to one or more OVDs”.
Furthermore, John Malone’s Charter would not be allow to “retaliate” against distributors that sell to on-demand services, and the DoJ said it would “vigorously enforce compliance” with terms of the deal.
“We are pleased that Chairman Wheeler has submitted the proposed conditions for consideration by the full Commission and that the DOJ has submitted its agreement for approval by the court,” said Charter in a statement.
“We are pleased to reach this critical step in the regulatory review of our merger with Charter, and remain optimistic that the transaction will be finalised soon,” added TWC CEO Rob Marcus.
Charter CEO Tom Rutledge will run the new group, whose creation has been opposed by various players in the US market.