- Charter Communications completed its acquisition of Cox Communications and Liberty Broadband, expanding Spectrum to 45 states with Cox owning 26% of the combined company.
- Spectrum will launch full services in former Cox markets by mid-September, offering expanded connectivity, streaming options, and US-based 24/7 customer support with faster repairs.
Charter Communications Inc. announced on Thursday that it has completed its previously announced transaction with Cox Communications and its acquisition of Liberty Broadband Corp., creating what the company describes as the nation’s leading broadband and video company and the fastest-growing mobile provider in its footprint.
The transactions expand Charter’s Spectrum footprint to 45 states and are expected to deliver expanded connectivity, entertainment options and customer service to Cox customers, while creating new opportunities for employees, communities and shareholders, according to a Charter press release.
“The addition of Cox to the Spectrum footprint is one that can be celebrated by customers, employees and investors alike,” said Chris Winfrey, Charter president and CEO, in the release. “Together, we will bring the best products, at the best price, coupled with the highest level of customer service to more customers across our expanded 45-state Spectrum footprint.”
Winfrey said the expanded company will be better positioned to compete with national and global connectivity and entertainment providers while continuing to invest in products, services, technology and the Spectrum Fiber Broadband Network.
Eric Zinterhofer, who served as chairman of Charter’s board before the transactions closed, congratulated Charter, Cox and their teams on completing what he described as an industry-transforming transaction. He will serve as lead independent director as Alex Taylor becomes Charter’s next chairman.
“When Liberty first invested in Charter more than a decade ago, we saw an opportunity to build scale behind a great management team and operating model,” said Dr. John C. Malone, chairman of Liberty Broadband, in the release. “The combination of Charter and Cox creates a stronger, more competitive company to further invest and innovate, while giving Liberty Broadband shareholders a direct interest in its future.”
Cox Transaction
As part of the transaction, a subsidiary of Cox Enterprises Inc. received approximately 33.6 million common units in Charter Holdings, with an implied value of approximately $5 billion. The units are exchangeable for Charter common shares.
Cox Enterprises also received $6 billion of convertible preferred units in Charter Holdings with a 6.875% coupon. The units are convertible into 12.6 million common units of Charter Holdings and exchangeable for Charter common shares. In addition, Cox Enterprises received approximately $4 billion in cash.
In total, Charter issued the equivalent of just over 46 million Charter shares to a subsidiary of Cox Enterprises. Based on Charter’s June 30 share count and giving effect to the Liberty Broadband merger and Cox transaction, Cox Enterprises and its subsidiaries now own approximately 26% of the combined company’s fully diluted shares outstanding on an as-converted, as-exchanged basis.
Approximately $12 billion of Cox debt and finance leases also will remain outstanding at Charter subsidiaries as a result of the transaction.
Alex Taylor, chairman and CEO of Cox Enterprises and chairman of Charter’s board of directors, said the transaction builds on his family’s long history of investing in businesses that serve communities and create long-term value.
“For generations, my family has believed in building businesses that matter and stand the test of time,” said Taylor in the release. “The broadband industry has shaped how people live, work and connect with one another, and we believe deeply in its future.”
Spectrum Services Coming to Cox Markets
Beginning Aug. 20, Spectrum is offering Cox internet customers who do not already subscribe to Cox Mobile a free mobile line for one year as part of its welcome to new customers.
In mid-September, Spectrum plans to launch its full suite of products to consumers, including existing customers, in former Cox markets. The company said the offerings will include Spectrum’s pricing and packaging, additional opportunities to save and expanded connectivity and entertainment options.
Spectrum Internet and Spectrum Mobile operate over the Spectrum Fiber Broadband Network and are supported by approximately 45 million Wi-Fi access points nationwide. The company said its Seamless Connectivity bundle is designed to provide a more integrated experience and includes Spectrum’s $1,000 savings guarantee.
Spectrum’s video offerings will include live television and streaming services through its Seamless Entertainment platform. Spectrum TV Select plans include ad-supported streaming services such as Disney+, Hulu, ESPN Unlimited, Discovery+, HBO Max, Paramount+, Peacock, AMC+, ViX, Tennis Channel and FOX One, which the company says provide up to $127 in monthly retail value at no additional cost.
Customers also will be able to use the Spectrum TV App to stream, pause and rewind live television and access on-demand and DVR content on mobile devices and popular streaming platforms. The Xumo Stream Box with voice remote will provide another way to search and switch between live television and streaming services.
Customer Service Commitments
Within the next year, Cox customers are expected to benefit from Spectrum’s Customer Service Commitments, including:
- A 100% U.S.-based customer service team available 24 hours a day, seven days a week.
- Faster service-disruption repairs, including same-day technician dispatch for requests made before 5 p.m., or the following day for requests made later.
- Customer credits for outages lasting longer than two hours.
Over the next 18 months, Spectrum plans to apply its sales and service workforce model to Cox markets and fully return Cox’s customer service function to the United States.
The company said all employees will earn a starting wage of at least $20 per hour and have access to Spectrum benefits, including medical, dental and vision coverage for full- and part-time employees; retirement benefits with a 401(k) company match of up to 6% of eligible pay; and free or discounted Spectrum Mobile, TV and internet service.
Additional employee benefits include career advancement and development programs, the Broadband Field Technician Apprenticeship program, tuition-free undergraduate degree and certificate programs, an Employee Stock Purchase Plan with matching Charter restricted stock units for eligible frontline employees and participation in the Invest in America Trump Accounts program, including a match of the federal government’s $1,000 contribution for employees’ children.