Charter to Buy Bright House in $10.4B Deal

Cable television operator Charter Communications Inc said it would buy privately held Bright House Networks in a cash-and-stock deal valued at $10.4 billion to expand in Florida.

Charter's shares rose as much as 10 percent in premarket trading on Tuesday after Reuters reported the deal earlier in the day.

Charter said it would pay Advance Newhouse, the owner of Bright House, $2 billion in cash and the rest in common and convertible preferred units of a newly created partnership for the deal.

Charter will own 73.7 percent of the partnership and Advance Newhouse will own the rest, the companies said in a statement.

Bright House has about 2 million video customers in central Florida, including Orlando and Tampa Bay as well as Alabama, Indiana, Michigan and California.

Charter, whose key markets include Alabama, Georgia, Michigan and California, lacks a strong presence in Florida, its latest annual filing shows.

Charter and its largest shareholder, Liberty Broadband Corp, have been open about their desire to consolidate the industry. Charter made a bid for Time Warner Cable Inc before Comcast swooped in with a $45.2 billion offer.

Goldman Sachs and LionTree Advisors are financial advisers to Charter and UBS Investment Bank is adviser to Advance Newhouse. Wachtell, Lipton, Rosen & Katz is the legal adviser to Charter.

Charter's shares were up 6.5 percent at $195.38 in premarket trading. Up to Monday's closing, the stock had risen about 18 percent in the past six months. (Reporting by Abhirup Roy and Devika Krishna Kumar in Bengaluru; Editing by Kirti Pandey and Saumyadeb Chakrabarty)