Comcast Corp will drop its planned takeover of Time Warner Cable Inc, Bloomberg reported, citing unnamed people familiar with the matter. According to the report, the pending federal approval from the U.S. Justice Department and Federal Communications Commission was the driving force behind Comcast’s decision.
Comcast decides on Thursday
According to the unnamed sources, the Comcast board will convene and finalize all decisions on Thursday. The company’s final decision will be made public on Friday. On the other hand, executives for Time Warner Cable already have plans to tell shareholders how the company will survive independently, sources told Bloomberg.
If there is one party that would face possible demise with the dropped deal, it would be Comcast, the sources said. Comcast direly needs to add more Internet subscribers to bring its pay-TV business into survival. On the other hand, Time Warner Cable could just move on and pursue other possible merger partners.
Furthermore, the demise of the deal will be advantageous to online companies such as Amazon, Netflix and other companies relying on the Internet to provide their programs.
“Comcast’s withdrawal of its proposed merger with Time Warner Cable would be spectacularly good news for consumers,” Michael Copps, a Democratic former FCC commissioner, said in a statement obtained by Bloomberg.
Comcast lobbyists are said to be making their last desperate attempt to continue with the deal. However, there exists little hope, Bloomberg said.
Comcast plans to drop Time Warner Cable deal
A separate report from The New York Times said that intense regulatory scrutiny prevents Comcast from continuing the deal. The Justice Department “is not confident in its ability to restrain Comcast with conduct remedies,” Christopher Jon Sprigman, a former Justice Department antitrust official who is now a professor at the New York University School of Law, revealed to The New York Times.
Comcast is “too powerful and they had shown before they don’t respect very much,” Sprigman said.
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