Charter, Cox Communications merger valued at $34.5B

On Friday, Charter Communications, a leading telecommunications company in the U.S., revealed a merger with Cox Communications, a privately held company, in a multi-billion-dollar agreement. Following the merger, the combined entity will adopt the name of Cox, based in Atlanta and a subsidiary of Cox Enterprises, a private firm established in 1898 with interests in the automotive sector. Cox secured its initial cable franchise in 1962, and the deal values Cox Communications at around $34.5 billion.

Charter Communications saw a rise in its stock on the Nasdaq Composite when markets opened but later dipped slightly, with shares increasing by $7.03 or 1.68% at 10:42 a.m. EDT. In the deal, Charter, headquartered in Connecticut, will take over all of Cox’s commercial fiber, managed IT, and cloud businesses. Cox will receive $4 billion in cash and around $17.9 billion in combined shares, granting the parent company roughly a 23% ownership in the new venture. The newly formed company will keep its headquarters in Stamford, Conn., and will also absorb Cox Communications’ existing $12 billion debt.

Before the merger, Charter was the largest cable operator in the U.S., serving over 32 million subscribers across 41 states, and ranked as the fifth-largest residential phone line provider. The Spectrum brand of Charter will remain after the merger and will be the consumer-facing brand in the areas Cox operates in.

In 2017, Charter partnered with Comcast Communications to collaborate on wireless services, following its acquisition of Time Warner Cable for $78.7 billion. Chris Winfrey, President and CEO of Charter, stated, “Cox and Charter have been pioneers in connectivity and entertainment services, investing heavily to develop and expand our regional networks, offering internet, video, voice, and mobile services.” He added that the merger will enhance their ability to innovate and provide high-quality products at competitive prices, along with excellent customer service.

Winfrey will continue to hold both executive positions post the completion of the merger. Alex Taylor, Chairman and CEO of Cox Enterprises, expressed, “Our family has always believed in investing for the long term and remaining committed to the best interests of our customers, employees, and communities.” He also mentioned that partnering with Charter will elevate this commitment, benefiting customers, employees, suppliers, and local communities.