Corporate Law Blog

Cable merger runs into problems in different areas of Kentucky

Many of our readers have by now heard of the proposed merger of Comcast and Time Warner Cable. As part of the merger agreement reached by the companies, approval from at least 85 percent of Time Warner Cable’s client base is required, and some markets have been putting up resistance.

Readers may also have heard that there has been opposition to the merger in some parts of Kentucky, with several areas having taken steps to prevent the merger from going through in those localities. Campbell County and the City of Danville have already done so, and the City of Somerset took similar steps earlier this month when its city council voted against the proposed merger. 

The merger rejections have taken place due to various complaints, including poor customer service and failure to offer desired channels. Other localities have approved the merger, but only after reaching deals with the companies after considering rejection. Interestingly, those experienced in the field of cable franchising say that the merger rejections unusual, though many of the complaints seem to reflect widespread dissatisfaction with cable services and, to that extent, seem appropriate. The localities that have rejected the deal may, though, have to deal with litigation as a result.

Navigating mergers and acquisitions is not an easy task for businesses, and it is critical to work with an experienced team of professionals when doing so. Having accurate legal guidance is important to ensure that proper planning is done, that contracts are wisely negotiated and accurately complied with, and that other legal aspects of the process are orchestrated.

Source: The Wall Street Journal, “Kentucky vs. Comcast,” Shailini Ramachandran, Nov. 17, 2014.