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Comcast to drop Detroit if FCC approves Time Warner merger
2014-10-07 08:33:00| Telecompaper Headlines
(Telecompaper) Comcast has revealed it will pull out of Detroit and other midwestern and southern US communities if the Federal Communications Commission (FCC) green lights its USD 45.2 billion acquisition of number two cable operator Time Warner Cable. In a reply to groups objecting to the proposed merger, Comcast said it would withdraw from some markets, to become what it described as "an urban clustered cable company", above all gaining New York and Los Angeles. In total, the transaction would expand Comcast's video customer base by 7 million. By giving up markets such as Detroit, Minneapolis-St. Paul or Cleveland, Comcast would keep its share below the limit of 30 percent of US pay-TV homes that the company has agreed to honour. If the proposed merger gains regulatory approval, cable subscribers formerly under the Comcast umbrella in cities such as Detroit, Minneapolis and elsewhere would be served by a new company, GreatLand Connections, a joint venture with Charter Communication. However, as Bloomberg points out, GreatLand would start with USD 7.8 billion in debt, equal to about five times its earnings before interest, taxes, depreciation and amortization (EBITDA).
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Category:Telecommunications