Analyst Sees Little M&A Movement From Court's Cap-Relief

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As a potential driver of new system mergers in the cable marketplace, a federal court's smackdown of the 30% sub cap Friday is "largely a nonevent."

That's according to Sanford Bernstein senior analyst Craig Moffett.

In an advisory to clients, he pointed out that Comcast was the only one close to the cap, and at 25% of subs nationally, it could already have combined with Cablevision or Charter without reaching 30%.

He also noted that any merger would still have to be looked at by the Federal Communications Commission. He suggests a combo with Time Warner, which would create a company with about 38% sub reach, would probably be rejected by the current FCC, which now has a Democratic majority.

Of course, the FCC that upheld the cap had a Republican majority, with then chairman Kevin Martin teaming with the two Democrats.

Moffett said the victory may be "sweet vindication" after what he, and many others, have called an anti-cable era under Martin.

The analyst also wrote that he did not view the court's action as "a meaningful precursor to any actual transactions," saying any ensuing M&A activity would probably have happened anyway.