Time Warner loses a suitor in Comcast but Charter’s in the wings

Time Warner Cable Inc., the second-largest U.S. cable-TV provider, just lost a suitor. Another may be waiting in the wings.

Comcast Corp. dropped its $45.2 billion deal, valued at about $158.82 a share, to buy Time Warner Cable on Friday after concluding regulators would reject it. Charter Communications Inc.’s advisers have already reached out to Time Warner Cable to begin talks on an acquisition, people with knowledge of the matter said.

Charter, the fourth-largest U.S. cable provider, lost out to Comcast more than a year ago in an effort to buy Time Warner Cable. Now it wants another shot. John Malone, who controls Charter’s largest investor, Liberty Media Corp., said “hell yes” in November when asked if Charter would try again if the Comcast deal failed.

The big question isn’t whether Charter will bid again, but for how much. It would likely have to dole out more than Comcast agreed to pay, which topped Charter’s own $132.50-a-share hostile bid in January 2014. Time Warner Cable shares have increased about 14 percent since then. The price could be at least $151 a share, according to an estimate from Craig Moffett, an analyst at MoffettNathanson.

“Time Warner Cable showed no appetite for being acquired by Charter at the time, and our suspicion is that that hasn’t changed,” Mr. Moffett said late Thursday in a note to clients. “Time Warner Cable is certain to argue that they are worth more now than they were then.”

Charter’s goal is to buy Time Warner Cable quickly, said the people, who asked not to be identified because the deliberations are private. Charter, based in Stamford, Conn., has approached banks about financing, one person said. Executives at the companies haven’t spoken yet and the issue of price or structure hasn’t been addressed, the people said. The talks may not result in a deal, they said.

After the planned merger with Comcast was terminated, Time Warner Cable CEO Rob Marcus said that his company was “a oneof-a-kind asset.”

“We are confident we will continue to create significant value for shareholders,” Mr. Marcus said in a statement.

Time Warner Cable, which is based in New York City, jumped 4.4 percent to $155.26 at the close in New York, giving the company a market value of about $43.6 billion. Charter rose 1.2 percent to $185.75.