Comcast: Time Warner Cable Deal Is 'Approvable'

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Comcast CEO Brian Roberts

UPDATED: Chairman and CEO Brian Roberts also says the proposed transaction "underscores our belief in the cable business," on which his team remains bullish.

Comcast chairman and CEO Brian Roberts on a conference call with Wall Street analysts touted that the $45 billion acquisition of Time Warner Cable is "approvable" and "underscores our belief in the cable business."

Comcast also owns entertainment giant NBCUniversal.

"This is a very exciting day for all of us," Roberts said, starting his remarks, saying $1.5 billion in estimated synergies will hopefully prove to be conservative, saying his team was very bullish on the cable business and has "a lot of experience integrating cable assets."

Executives emphasized Thursday though that while analysts are predicting savings in terms of programming expenses, Comcast expects that part to make up a minority of synergies.

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Management also emphasized that the synergies exclude likely revenue synergies. In that context, Roberts said the combined company would be a "world-class blue chip company committed to innovation."

Addressing regulatory issues, Roberts said the deal was "approvable." He argued: "It is pro-consumer, pro-competitive and strongly in the public interest" since it will ensure accelerated advanced technology deployment and new product launches.

He added that the deal will not reduce competition in any relevant markets as the two companies don't operate in any of same zip codes.
And he said satellite TV and telecom companies will continue to compete with the same number of companies in each local market.

Roberts also highlighted that after the sale of systems with up to 3 million subscribers, Comcast will have "roughly" the same pay TV market share as it had after its AT&T Broadband and Adelphia deals, but in what is now a "more competitive" market.

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Roberts also cited a previous 30 percent market share cap that he said was twice vacated by courts. The new company's share will be below that, he emphasized.

Asked if regulators could put new regulatory restrictions on NBCUniversal, Roberts said the company had "no assurances" at this time that this won't happen, but expressed confidence. "We just have our judgment and experience, but it will be a process," he said. He added that so far, the NBCUniversal acquisition has caused no regulatory concerns in its first years, and rules for it remain in place for at least a few more years.

David Cohen, Comcast executive vp in charge of government and regulatory affairs, public affairs, legal affairs and other issues, reiterated the same points later in the call. He said that the Time Warner Cable deal would cause "no reduction in choice for consumers."

"Any legitimate concerns are fully addressed by the highly competitive marketplace," existing regulatory rules, regulations governing the NBCUniversal-Comcast deal and new undertakings announced Thursday, he argued.

"This simply is not a horizontal merger," and it will have "no impact" on the competitiveness of other pay TV firms, Cohen said. He did acknowledge though that the deal would get a careful regulatory review.

Cohen on Thursday also touted the opportunity to boost broadband services reach in lower-income areas as one key public interest benefit of the deal.

Time Warner Cable chairman and CEO Rob Marcus on Thursday said the combination of the two largest U.S. cable companies would be "truly special." Asked about Charter's previous takeover offer, he said the two proposed deals compared like "apples and oranges."

Asked about the biggest strategic opportunities for the merged company, Roberts cited small- and medium-sized companies looking for pay TV and other services, ad sales, cloud-based services and other innovations. 

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