Malone floats scenarios for Time Warner Cable – Charter merger

Liberty Media (Nasdaq: LMCA) Chairman John Malone told Reuters he sees a potential for Time Warner Cable (NYSE: TWC) to acquire other cable MSOs, and he also suggested a scenario in which a Liberty-backed Charter Communications (Nasdaq: CHTR) could acquire the nation's second-largest cable MSO.

"Whether A merges with B, B buys A or A, B and C get together to do a joint ventures to do things that have to be done in larger scale, that's really the message I'm trying to deliver," Malone told the wire service in an interview at the Allen & Company Sun Valley Conference in Idaho.

Liberty Media acquired a 27 percent stake in Charter for $2.6 billion in March, giving Malone four seats on the company's board of directors. There has been speculation since then that Malone could help Charter merge with other U.S. cable MSOs, including Time Warner Cable.

Malone sold Tele-Communications Inc., which was once the biggest U.S. cable MSO, to AT&T (NYSE: T) in 1998 for $48 billion. The telco sold its AT&T Broadband systems to Comcast (Nasdaq: CMCSA) in 2002. Malone told Reuters that cable MSOs need the scale that would result through mergers in order to thrive.

"Comcast is large enough to do OK. The rest of the industry needs consolidation, in our view, in order to get scale economics," Malone said.

For more:
- Reuters has this story

Commentary: Will Time Warner Cable buy Cablevision? Comcast co-founder Brodsky predicts more consolidation

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