Time Warner Bags Insight Communications For $3 Billion
Rumors began to circulate about Time Warner's plans late Sunday, and the deal was formally announced Monday. It's Time Warner's third major M&A deal of the year following its February acquisition of cloud hosting provider NaviSite for $230 million, and its June purchase assets from Missouri cable company NewWave Communications for $260 million.
Time Warner Cable has a about 12 million cable customers and is the country's second largest cable company after Comcast. Insight, which covers about 750,000 customers in Indiana, Kentucky and Ohio, is the ninth largest.
According to Insight, it has about 537,000 high-speed data subscribers, 679,000 video subscribers and 297,000 voice subscribers. It is currently owned by private equity interests, including The Carlyle Group, Crestview Partners, and MidOcean Partners, as well as members of its management team. Carlyle and Crestview took Insight private in 2005.
Glenn Britt, chairman and CEO of Time Warner Cable, said Time Warner found Insight a good fit to add to its Midwest footprint.
"We believe in our business and its long-term prospects and have long thought that Insight's well-run, technologically advanced systems would fit well with our Midwest operations," Britt said in a statement. "With the deal announced today, we are able to acquire those systems at an attractive price that is consistent with both our disciplined approach to M&A and our capital allocation strategy."
Time Warner said Monday that the deal could generate cost savings of $100 million within closing.
Time Warner and other cable companies have been active participants in the ongoing convergence of the IT VAR and telecom service provider agent channels, especially as the major cable players consolidate and also broaden their technology offerings to include services like SIP trunking and cloud hosting.