Moffet Sees Little M&A Movement From Cap-Killing
Suggests a combo with Time Warner
By John Eggerton -- Broadcasting & Cable, 8/28/2009 1:44:13 PM
As a potential driver of new system mergers in the cable marketplace, a federal court's smackdown of the 30% sub cap Friday is "largely a nonevent."
That's according to BernsteinResearch senior analyst Craig Moffett.
In an advisory to clients, he points out that Comcast was the only one close to the cap, and at 25% of subs nationally, it could already have combined with Cablevision or Charter without reaching 30%.
He also points out that any merger would still have to be looked at by the FCC. He suggests a combo with Time Warner, which would create a company with about 38% sub reach, which would probably be rejected by the current FCC, which now has a Democratic majority.
Of course, the FCC that upheld the cap had a Republican majority, with FCC Chairman Kevin Martin teaming with the two Democrats.
Moffet says the victory may be "sweet vindication" after what he, and many others, have called an anti-cable era under Martin. He says he does not see it as "a meaningful precursor to any actual transactions," saying any ensuing M&A activity would probably have happened anyway.
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