Powered by TMCnet
| More

Cable Technology Feature Article

December 30, 2011

Charter Buys Back Millions of Shares

By Narayan Bhat, TMCnet Contributor

America’s fourth-largest cable company, Charter Communications (News - Alert) Inc., has bought back about 4.125 million shares of its class A stock at a cost of about $200 million.

The St. Louis-based company said it had agreed to purchase a further 5.891 million, for a total of $321 million, in privately negotiated transactions.

The cable operator said it had entered into a stock repurchase agreement with a shareholder to purchase 750,000 shares at $55.18, a 1 percent discount to the closing price on December 22, 2011.

In addition, it will acquire a total of 5.141 million shares from certain funds affiliated with Oaktree Capital Management and Apollo Management Holdings at the price of $54.35 per share, a 3.5 percent discount to the December 23, 2011 closing price.

After the transactions, according to Business Journal, Apollo is expected to own 33.541 million shares of Charter’s Class A common stock, or about 33.26 percent of the company, and Oaktree will retain 16.615 million shares, or 16.56 percent of the outstanding shares.

“In 2011 we have repurchased 12.7 percent of the Company's outstanding shares at an average price of $50.17, which reflects a series of strategic opportunities to deliver value to our shareholders,” said Mike Lovett, president and chief executive officer of Charter.

According to a report from Bloomberg, Charter aimed to refinance as much as $1 billion, including high-cost debt that funded its November 2009 bankruptcy exit.

The cable operator reported revenue of $7.1 billion in 2010.

In other news, Charter Communications, Inc. recently announced the expansion of voice service offerings from Charter Business to include SIP Trunking.SIP Trunking will deliver voice service to large and mid-size businesses through a converged voice and data fiber network that can scale quickly to meet utilization needs, eliminating the need for the customer to purchase separate circuits or connections for voice traffic, the company said.

Narayan Bhat is a contributing editor for TMCnet. To read more of Narayan’s articles, please visit his columnist page.

Edited by Jennifer Russell