Will the Comcast-TWC Merger Happen in 2015?

Comcast’s proposed takeover of Time Warner Cable could be the biggest media acquisition in 14 years. But there’s a growing concern that the deal might come undone. Frank Aquila, partner at Sullivan & Cromwell, weighs in.

The FCC on Monday again postponed its review of the Comcast (NASDAQ:CMCSA)-Time Warner Cable (NYSE:TWC) deal until Jan. 12, blaming the hold up on not-yet-received documents needed from Time Warner Cable. First announced last February, the deal is now paused at day 104 on the 180 day clock allotted for review.

Should the deal be completed, Comcast’s purchase of Time Warner Cable will cost $69.8 billion, including liabilities. This would make the deal the largest media deal since AOL (NYSE:AOL) bought Time Warner (NYSE:TWX) for about $160 billion in 2000, according to Dealogic.

The combination of the two largest U.S. cable companies is widely expected to pass antitrust review because Time Warner Cable and Comcast do not operate in the same markets, due to a historical legacy. But the proposed deal has still faced a backlash with petitions and public outcry, and now some are saying that it is possible that Comcast could face enough concessions to make the acquisition less economically attractive, potentially derailing the deal.

“Once it takes this many months to close a deal, you start to wonder what’s going on,” Frank Aquila, partner at Sullivan & Cromwell and member of the firm’s management committee, tells FOX Business. “The landscape has shifted considerably since the Comcast/Time Warner Cable deal was announced. Opponents of Comcast are mounting a political campaign on all fronts to block the deal.”

Aquila says that “the regulators are looking at issues beyond anti-trust issues,” including “public good issues” and will evaluate how much of the total U.S. population the company reaches. Aquila says that ultimately the deal may be loaded with concessions, resulting in an “uneconomic transaction” for Comcast. The deal does not have a break-up fee.

But the consensus among analysts remains optimistic that the deal will be finalized. Rich Greenfield at BTIG says that although “not a whole lot of people in Washington, D.C., love this transaction, given the fact these companies in no way compete with each other, it seems like a challenging deal to block.” Greenfield does predict that “there will be a net neutrality-related clause built into the Comcast deal,” but that it will not be enough to stop the transaction from going through.

Jeffrey Wlodarczak from Pivotal Research Group also thinks that the acquisition will be finalized. “At the end of the day, Comcast has plenty of concessions that they can offer, and aren’t going to materially change the upside from a deal with Time Warner Cable.” Wlodarczak said the concessions could include guaranteed Internet speeds and some form of commitment to net neutrality.

Still, Wlodarczak points to some deal skepticism in the stock market, with a discrepancy between the deal price and the share price. “The discount from this offer is still relatively wide...the market is still kind of telling you there’s uncertainty there."

In regard to the latest FCC delay, Time Warner Cable tells FOX Business:“Today's delay is a procedural issue, not a substantive one. We already have provided the FCC more than five million pages of documents and we will continue to provide the FCC everything that they need to review this transaction.”

Comcast did not respond to requests for comment.

Comcast shares are up 10% year-to-date and closed Monday at $57.22