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Cable operator Charter Communications, Inc. (CHTR) entered a merger agreement on November 13, 2024, to acquire Liberty Broadband Corporation (LBRDA) in an all-stock deal valued at $17.05 billion.
Under the agreement, each person who owns Liberty Broadband common stock (Series A, Series B, or Series C) will receive 0.236 shares of Charter common stock for every share of Liberty Broadband stock they own.
The deal is valued at about $92.51 per share, representing a discount of 4.38% from the stock’s last close.
Liberty Broadband is a communications company that holds major interests in Charter Communications and GCI, Alaska’s largest telecom provider, delivering wireless, internet, video, and voice services.
Charter Communications is a leading broadband and cable company, serving over 58 million homes and businesses across 41 states through its Spectrum brand, providing internet, TV, mobile, and voice services to residential, business, and government customers.
Liberty Broadband, controlled by U.S. cable pioneer John Malone, currently owns approximately 45.6 million shares of Charter, which represents a 32.05% stake in the company.
Additionally, Liberty Broadband owns GCI, the largest communications provider in Alaska. Before Charter acquires Liberty Broadband, Liberty Broadband will spin off its GCI business and distribute it to its stockholders. This distribution is expected to be taxable for both Liberty Broadband and its stockholders, with Charter covering the corporate tax liability once the companies combine. If these taxes exceed $420 million, Charter can offset the extra cost by using a portion of GCI’s tax benefits.
The companies expect the transaction to close on June 30, 2027, subject to the completion of the GCI spinoff.
As part of the transaction, Charter plans to cancel the 45.6 million shares it currently owns through Liberty Broadband and issue about 34 million new shares to Liberty Broadband stockholders at closing. This will result in a net reduction of about 11.5 million Charter shares overall.
Charter Communications is paying 13.99 times sales for Liberty Broadband Corporation and 57.51 times EBITDA.
In September, Liberty had proposed a counteroffer to Charter for an all-stock deal where Liberty shareholders would receive 0.2900 per Charter share. The Liberty stock was trading at $59.87 before the proposal.
For a deeper insight into the M&A transaction, please visit the Deal Metrics page here:
The Deal Metrics page for each merger or acquisition includes:
– A spread history chart of the merger from announcement through eventual completion or failure.
– Every event as the merger progresses through the expiration of the HSR period, various regulatory approvals, shareholder votes, etc.
– News and SEC filings.
– A history of deal updates.
– And a whole lot more.
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Editor’s Note: Baranjot Kaur contributed to this article