Andre Yoskowitz
4 May 2015 22:00
According to Comcast's most recent earnings report, the cable giant has spent over $330 million in 'transaction-related costs' in its attempt to acquire Time Warner Cable, and Time Warner has spent over $220 million.
Comcast proposed to buy TWC in February 2014 for $45.2 billion and just canceled the proposed merger last month after it became clear it would never make it through Federal regulators.
In the Q1 alone, ended March 31st, Comcast had $99 million in costs related to the acquisition, and Time Warner Cable had $24 million in costs.
"The costs are mainly for legal fees and outside consulting firms--everything from Human Resources and IT consulting to banks and management consulting services," said Comcast VP of Government Communications Sena Fitzmaurice. "Communications and lobbying fees would be included--however, what is included has to be direct and incremental--so only those fees that are directly and incrementally associated with the deal."
At least there was one positive for Comcast shareholders: no break-up fee. The company says the deal was structured without an expensive break-up fee involved, which can sometimes reach into the billions. One recent example is AT&T's failed purchase of rival carrier T-Mobile in 2011. When the DOJ killed the merger, AT&T had to pay T-Mobile $4 billion in cash and spectrum, effectively reviving the carrier and allowing it to go on the offensive with pricing.
Source:
Ars