Charter Communications Further Reduces Influence of Paul Allen
NEW YORK – The board of cable operator Charter Communications has voted to reduce the influence of former chairman, and Microsoft co-founder Paul Allen.
The board, which had previously suggested it may do so, voted to convert all shares of Class B common stock of Charter held by Allen into the same number of shares of Class A common stock, which reduces his voting stake dramatically as B shares carried more voting power.
Allen's voting stake as a result has fallen considerably from 35 percent. According to Evercore Partners analyst Bryan Kraft, Allen's economic stake stood at only 5 percent previously, but the B shares boosted his voting influence.
Also as a result of the conversion, Allen no longer has the right to appoint four of the 11 members of the Charter board.
Charter said his appointees William McGrath and Christopher Temple have resigned from the board, which has instead added Edgar Lee and Stan Parker.
Lee is senior vp of Oaktree Capital Management, and Parker is a senior partner of Apollo Global Management. The two firms have been two of the dominant private equity owners of Charter since it emerged from Chapter 11 bankruptcy.
In the restructuring, debt was converted into equity, diluting the stake of Allen and other shareholders.