Time Warner Cable CEO Defends Charter Bid Refusal

NEW YORK (The Deal) -- Time Warner Cable (TWC) CEO Robert Marcus divided the company's Thursday, Jan. 30, investor call between presenting fourth quarter earnings and defending its resistance to buyout overtures from Charter Communications (CHTR).

"We're in the business of maximizing shareholder value," Marcus said, regarding Time Warner Cable's rejection of a $132.50 per share cash and stock offer from Charter, backed by John Malone's Liberty Media (LBTYA)

With Time Warner Cable's shareholder meeting approaching and the prospect of Comcast  (CMCSA) agreeing to pick up some markets from Charter in a side deal, the pressure on the second-largest U.S. cable operator may grow more intense. Comcast's involvement, which is not confirmed, would increase the financial resources behind a bid and possibly increase calls for Time Warner Cable to engage more fully in talks.

Craig Moffett of MoffettNathanson LLC described Time Warner Cable's position as a "last stand" in a Thursday note.

Marcus told investors that Time Warner Cable's numbers suffered last year because of the timing of increased promotional pricing, among other matters.

The CEO predicted customer losses would decrease as the company embarks on a three-year plan.

Time Warner Cable touted the rollout of an upgraded service dubbed TWC Max, which will have broadband speeds up to 300 Megabits per second and more digital video. The company projects it will spend $3.7 billion to $3.8 billion per year in cap-ex to improve its systems, which is an increase but is not as much as Charter would spend.

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