NEW YORK (The Deal) -- John Malone and Charter Communications (CHTR - Get Report) ratcheted up the hostility in their pursuit of Time Warner Cable (TWC - Get Report) on Tuesday nominating a full slate of 13 independent candidates to the target's board.
Charter had until Friday to submit the nominees.
Time Warner Cable CEO Robert Marcus in a Tuesday statement decried the move as an attempt to coerce the company's board into accepting "the same lowball offer" that it previously rejected. He's right, though the principle may be lost on investors who believe that a merged Charter-Time Warner Cable would benefit from scale and improved management, especially if the hostile suitor increases its bid.
Must Read: Gilt Groupe Begins Charting Course to IPO
Charter CEO Tom Rutledge said Tuesday that his team had received positive feedback from Time Warner Cable investors and suggested that the proposed directors give shareholders the opportunity to voice their support for a merger.
"It's an interesting combination of people with cable experience, some people with prior Time Warner experience and outsiders," said Bingham McCutchen telecom and media lawyer Andrew Lipman of the board nominees.
Charter's nominees include former Time Warner Cable chief technology officer James Alan Chiddix; European cable executive Bruno J. Claude; Harvard Law School lecturer and former Eton Park Capital Management managing director Isaac Corre; former Motorola Mobility executive Marwan Fawaz; ex-Martha Stewart Living Omnimedia (MSO) CEO Lisa Gersh; Dexter Goei, CEO of international cable group Altice Group; Ally Financial Inc. chairman Franklin W. Hobbs; Neil Morganbesser, CEO of investment banking firm Del Morgan & Co.; former Virgin Media CFO Eamonn O'Hare; David Peacock of Huron Capital Partners; Michael Salvati, president of healthcare advisory firm Oakridge Consulting; Hain Celestial Group founder Irwin Simon and Avalon Capital Partners president John E. Welsh III.
"Of course, even if this board is elected, they still need to vote as fiduciaries; it doesn't necessarily mean that they would rubber-stamp any position," Lipman added.
The lawyer pointed to the example of Air Products & Chemicals' (APD) hostile pursuit of Airgas (ARG) in 2010. As part of its takeover strategy, Air Products proposed three directors to the target's board. All were elected.
"Those three directors actually voted in a way that was favorable to Airgas as opposed to Air Products," Lipman said.
Marcus became Time Warner Cable CEO on Jan. 1. The former TWC chief operating officer, Time Warner (TWX) M&A executive and Paul, Weiss, Rifkind, Wharton & Garrison lawyer replaced Glenn Britt, who had been CEO since 2001.