Comcast plans to drop Time Warner Cable merger

Apr 24, 2015, 12:26 AM EDT
 A Comcast service van is shown on April 23, 2015 in Miami, Florida. Published reports indicate that Comcast Corp. is pulling the plug on its proposed $45 billion merger with Time Warner Cable due to regulatory hurdles.
AFP/Getty Images

Comcast Corp's board was meeting late on Thursday to finalize plans to abandon its proposed $45 billion merger with Time Warner Cable Inc, according to a person directly familiar with the matter, reports Reuters.

A formal announcement is expected as early as Friday, the person added, asking not to be identified because the deliberations are confidential. Comcast and Time Warner Cable declined to comment.

The news came a day after officials of Comcast and Time Warner Cable, the two largest U.S. cable companies, met with reviewers at the Justice Department, which is considering whether the deal would harm competition, and the Federal Communications Commission, which is considering whether the deal was in public interest. Both agencies signaled reservations, though sources told Reuters it was the FCC's strong stance that particularly tipped the scales to drop the deal, which carries no break-up fee.

FCC reviewers told the agency staff at a Wednesday briefing that they planned to recommend taking the merger issue to an administrative law judge for a hearing, which would amount to the FCC blocking the deal.

That was the latest flex of muscle by the FCC under Chairman Tom Wheeler, who recently imposed the strictest-ever regulations on Internet providers and in 2014 helped scuttle a potential merger between wireless carriers Sprint Corp and T-Mobile US.

Bloomberg first reported on Thursday that Comcast planned to drop its merger offer in the face of opposition from regulators. The Justice Department's antitrust attorneys were also nearing a recommendation to sue to block the merger, Bloomberg reported.