This type of merger is a considered a horizontal merger between the two largest companies in the Internet and cable industry. Comcast will need to show the FCC that the proposed merger will benefit consumers, reducing the price that they currently pay for Internet and cable services while not limiting their choice in providers.
Comcast Horizontal Merger
On February 13, 2014 Comcast announced their intention to merge with Time Warner Cable. The proposed merger would be a “friendly, stock-for-stock transaction”, where Comcast will procure 100% of Time Werner Cable’s 284.9 million shares, “amounting to approximately $45.2 billion in equity value”. According to Freepress.net the proposed merger would create, “an Internet and cable juggernaut with unmatched power to crush the competition and hike prices for consumers”, giving Comcast a one-third control in the Internet and cable industry. The Federal Communications Commission (FCC) has yet to approve the merger.
Posted by Susie at 2/28/2015 09:50:00 PM