Time Warner Cable Exec Addresses Sale Rumors
NEW YORK – Time Warner Cable's management team is "completely focused" on running the company "for the long haul," COO Rob Marcus, designated to become CEO at year's end, said here Monday.
But he added that he would not let personal ambition get in the way of a possible sale of the company if that was the best path for shareholders.
"Whether or not Time Warner Cable will participate in M&A as a buyer or seller is 100 percent driven by what's in the best interest of shareholders," he said.
Speaking at the 41st annual UBS Global Media and Communications Conference, he was addressing a key topic of debate amid the latest reports that Comcast, Charter Communications and Cox Communications were exploring possible bids for the second-largest U.S. cable operator. He criticized a Bloomberg report from last week, saying that in the interest of a sexy headline, it took a quote from him out of context, making it sound like he was ready to sell now and was just waiting for the right price to pull the trigger on a deal.
TWC would accept an offer in the range of $150-$160 per share, Bloomberg News had said in its report last week.
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Attendees of Marcus' session went away feeling a deal could still happen soon if the price was right. Programming costs and headcount reductions are among the key benefits of potential deals, Marcus said Monday.
He also said regional sports network deals have worked for TWC so far, but he said the acquisition of larger content assets was a different animal. He said he has never seen the rationale or potential synergies behind combining content and pay TV distribution businesses. He said the lack of such benefits was behind the decision to spin off TWC from Time Warner, and he agreed with that.
Marcus is set to take over the CEO role from retiring Glenn Britt at the end of the year.
"There is a healthy mix of both continuity and change," Marcus said when asked whether he would change much about TWC's business approach once he takes over.
He cited a focus on having the right people, structure and culture at the company as key focus areas. Marcus cited recent hires as having strengthened the company's skill sets. He also said that "I'm intent on creating that tone" of competitive fire, "fire in the belly" that starts from the top of the organization.
Putting the customer at the center of everything TWC does is key for the firm's success as is financial discipline, including in possible deals, he said.
Asked about his view on whether cord-cutting was a threat for cable operators, Marcus said that "there is no question that online video viewing continues to increase at a fairly healthy clip," but added that so far it is "not seen as a substitute" for the breadth and quality of offers from cable firms. He called over-the-top, or broadband, video services such as Netflix "the killer app that highlights the value of our broadband offering."
Asked if TWC could make Netflix or similar services available on its cable set-top boxes, he said that was "an interesting concept," adding that "we are certainly open to it." He also argued that TW Cable has been at the forefront of making its services available on more devices.
Marcus declined to discuss upcoming carriage deal negotiations, which are known to include talks with Viacom, but said that programming cost increases would "continue to outpace the growth in video revenue." He said the company would increase its VOD offerings next year.
Marcus on Monday also said an L.A. Dodgers network would launch in late February, with carriage deals likely to be reached late in the game, as is often the case.