Verizon is said to be considering a deal with Charter, the company that recently bought Time Warner Cable. Talks of the takeover have led to a surge in Charter shares.
If the said deal pushes through, the resulting organization would certainly be a great telecom force with an extended reach in both wired and wireless communications. JP Morgan has predicted a telecom consolidation in the U.S. under the Trump Administration but mentioned T-Mobile as the likely party to enter a major transaction.
Charter is one of the biggest cable companies. With the acquisition of Time Warner Cable, it is now called Spectrum. Charter aims to make it the fastest growing Internet, TV, and voice provider through this merger.
AT&T bought DirecTV in 2015 and has since become the biggest pay-TV operator in the US with 25.3 million subscribers. The company wanted to acquire Time Warner for $85.4 billion to its boost content and establish its brand in the media and entertainment market.
If the Wall Street Journal's report is accurate, Verizon may have a deal with Charter.
"Verizon CEO Lowell McAdam has made a preliminary approach to officials close to Charter and Verizon is working with advisers to study a potential transaction," the WSJ reported. While there is no guarantee of the deal yet, the prospect has raised a lot of interest.
Charter's shares increased more than seven percent in trading this morning after news of its potential agreement with Verizon. Both Verizon and Charter have not issued any statement on the possible yet.