Charter Communications stock went on a wild ride last week, rising more than 6% on Feb. 5 on speculation that the fourth-largest MSO in the country was on the verge of a major deal of some kind.
Charter closed at $81.53 on Feb. 5, up $4.83 (6.3%), fueled by some reports it would either be acquired or make a major purchase.
Deadline.com kicked off the speculation with a story that Wall Street was abuzz that Charter could be involved in a deal with either Time Warner Cable or Cox Communications. The piece said Charter had frozen all budgets, including hiring at its soon-to-be new headquarters in Stamford, Conn.
That last part could not be confirmed, and sources said Charter already has about 70 people in Stamford — it plans to have 100 there eventually.
Charter wouldn’t comment on what it called rumor and speculation. Neither would Time Warner Cable or Cox.
Several sources said there was little truth or sense to the rumors surrounding the secondary-market MSO.
But, like paranoia, that doesn’t always mean the rumors are untrue.
Several mitigating factors that are relatively easy to explain, though, could have contributed to a belief that Charter had a big merger (or sale) in the works.
A bigger merger, that is, than the $1.6 billion pact to buy Cablevision’s former Bresnan systems, announced last Thursday.
Charter had been seeking a new senior vice president of corporate finance for months, because Matt Derdeyn decided he didn’t want to uproot his young family with a move to Stamford and, instead, took a job as CFO at Answers.com in St. Louis.
When Charter hired former Guggenheim Securities managing director Charles Fisher to succeed Derdeyn, it wasn’t a big surprise to Charter watchers. But it looked like Charter was potentially gearing up for some M&A activity.
And on Feb. 4, Lone Pine Capital, the $17 billion hedge fund led by investment guru Stephen Mandel, disclosed that it owned 7.2 million shares of Charter, up from the 300,000 shares it owned in September. Mandel is a well-respected stock picker, so his involvement in the company could have spurred more interest in Charter.
Whatever the reasons behind the rise, the enthusiasm didn’t last long. Charter closed at $80.63 on Feb. 7, down 42 cents.
Fiber Plant Issues: EAGLE-Net Explains Its Flora-Loving Logic
The Wire readers may recognize EAGLENet Alliance as the broadband-stimulus funding recipient that cable operators claim is overbuilding their existing operations.
The company, though, says it’s worried about a different kind of overbuilding — the kind that would crush the “clay-loving wild buckwheat” and the “pagosa skyrocket.”
EAGLE-Net’s government stimulus grant was suspended in December after the company changed its buildout route without informing the National Telecommunications & Information Administration, which oversees the grants.
EAGLE-Net says it was trying not to disturb two species of wild plants in Southwestern Colorado.
For those not in reach of their copy of Broadband-Endangered Wild Flowers of Colorado, EAGLE-Net said the clay-loving wild buckwheat is a “rounded, denselybranched subshrub.” (We just loved writing that.)
The pagosa skyrocket is an “herbaceous biennial endemic to shale outcroppings” whose formal name, Ipomopsis polyantha, sounds to The Wire like Latin for Hayley Mills.
Who says writing about BTOP grant overbuild proposals is dry brush? OK, The Wire may have, but EAGLE-Net has almost single-handedly redeemed the genre.
— John Eggerton
Satirically Yours: Post-Holiday Greeting Tweaks ‘Mean’ Mogul
You’re a mean one, Rupert Murdoch.
In the “wait for it” punchline category comes a belated holiday card from media consolidation critic Free Press.
The Wire’s D.C. bureau received the card (postmarked Jan. 28) and noticed the picture of The Grinch looking a lot like Murdoch, whose News Corp. owns the top-rated cable news network, as well as TV stations and newspapers and satellite TV operations and studios and we don’t know what all. (Actually, we do, but the point is made.)
“What do you give the media mogul who has everything?” the card asks.
“You give him hell,” the inside of the card explains.
A Free Press spokesperson said it took longer this year to get the card from the printer and to get its mailing list squared away. “It was meant to be a joke,” the spokesperson said.
Perhaps. But if Free Press hasn’t been trying to give Murdoch hell, we don’t know who has.
— John Eggerton
Invisible Man? Powell Overlooked As FCC Trailblazer
In a recent online opinion piece for CNN, urging President Obama to pick a woman to head the Federal Communications Commission, JaneFonda, Robin Morgan and Gloria Steinem praised the commission for breaking the color barrier.
“We’re glad to say the FCC has had black chairmen,” the co-founders of the Women’s Media Center said. “William Kennard, for example, made a top priority of closing the digital divide for African-Americans and for Americans with disabilities. It’s unfortunate that there have not been more, though we live in a diverse country in which white Americans are about to become the minority.”
Well, there was one other African-American FCC chief: Michael Powell, currently president of the National Cable & Telecommunications Association. The oversight might have been because Powell was a deregulatory Republican. And in 2001, when he began as FCC chairman, he uttered a joke in making the point that the wealthy will always have first access to the newest and greatest technologies: “I think there’s a Mercedes divide — I’d like to have one, I can’t afford one.”
But in the same breath, he committed the FCC to helping extend broadband access. In his post- FCC career, he has followed up on that pledge.
After the FCC, Powell was co-chair of Broadband for America, an organization working to help provide every American citizen with highquality access to the Internet. And he now heads the trade association representing cable companies, which have invested billions to deliver broadband service to homes with incomes high and low.
— John Eggerton
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