Time Warner headquarters in New York City. (Time Warner Inc.)
Time Warner Cable rejected as “grossly inadequate” Tuesday a $61.3 billion takeover bid by rival Charter Communications, with the former tapping longtime outside counsel Paul, Weiss, Rifkind, Wharton & Garrison for representation on the matter and the latter relying on Wachtell, Lipton, Rosen & Katz and Kirkland & Ellis, according to securities filings.
Charter’s unsolicited offer for the the nation’s second-largest cable operator—roughly $37.8 billion in cash and stock, the rest in assumed debt—comes some five years after Paul Weiss advised TWC in connection with its $9.25 billion split from former parent Time Warner Inc.
Paul Weiss M&A cohead Robert Schumer—an American Lawyer Dealmaker of the Year in 2011 for his role advising TWC on its $3 billion buy of Insight Communications—is leading a team of lawyers advising the the New York–based cable giant that includes M&A partners Ariel Deckelbaum and Ross Fieldston, the latter of whom was elected to the firm’s partnership on Jan. 1.
Veteran Wachtell M&A partner Steven Cohen, meanwhile, is representing Charter in connection with the TWC offer, working alongside corporate partner DongJu Song and tax partner Jodi Schwartz. The engagement is Wachtell’s first for Charter, which moved its corporate headquarters in late 2012 from St. Louis to Stamford, Conn.
As for Kirkland, the firm is handling finance work related related to Charter’s bid for TWC. Kirkland helped Charter emerge from bankruptcy in late 2009 and then took the lead for the company on its $2.6 billion sale last year of a 27.3 percent stake to cable billionaire John Malone’s entertainment conglomerate Liberty Media. Malone—whose Liberty Media tapped Baker Botts earlier this month to advise on its roughly $10 billion all-stock bid for satellite radio giant Sirius XM Holdings—could seize back his cable industry crown with a successful deal for TWC.
While TWC quickly rebuffed Charter’s preliminary offer, the two companies could ultimately still strike a deal. If that happens, a fresh round of U.S. cable industry consolidation—and a bevy of transactional assignments for other Am Law 100 firms—could follow.
Bloomberg reported late last year on one possibility: talks between Comcast—the country’s largest cable and Internet service provider—and Charter on a joint bid for TWC that would lead to the breakup of the target company in order to bypass the regulatory scrutiny typically raised about whether such megamergers are aligned with consumers’ interests. Comcast’s general counsel Arthur Block, a former WolfBlock partner who joined the Philadelphia-based cable giant in 1989 as its chief transactions counsel, declined a request for comment on whether the company is considering such an option.
Davis Polk & Wardwell has traditionally handled Comcast’s high-end corporate work. The firm advised the company on its $29.2 billion buy of AT&T Broadband a decade ago and $30 billion acquisition of a controlling stake in NBCUniversal from General Electric back in 2010. Last year Davis Polk helped Comcast pick up the remaining 49 percent stake in the media and entertainment company it didn’t already own in another $18.1 billion deal, according to our previous reports. (Davis Polk also took the lead for Comcast this month on a $2.5 billion broadcast rights agreement with Major League Baseball’s Philadelphia Phillies.)
Like many other companies in the media and telecommunications industry, Comcast keeps an array of lawyers and lobbyists on retainer to help tackle various regulatory issues. U.S. Senate records show that through the first three quarters of 2013, Comcast paid $270,000 to Brownstein Hyatt Farber Schreck, $240,000 to Blank Rome, $180,000 to Williams & Jensen, $120,000 to DLA Piper and $90,000 to Nelson Mullins Riley & Scarborough. Duane Morris chairman emeritus Sheldon Bonovitz and former Cleary Gottlieb Steen & Hamilton associate Eduardo Mestre are members of Comcast’s board of directors.
Charter has its own robust lobbying roster, paying $120,000 to Brownstein Hyatt through the first three quarters of last year, according to Senate filings. Charter hired former Patton Boggs technology and communications partner Robert Quicksilver in September 2011 to serve as its chief administrative officer.
Richard Dykhouse serves as Charter’s general counsel. Craig Jacobson, a founding partner of Beverly Hills–based Hansen, Jacobson, Teller, Hoberman, Newman, Warren, Richman, Rush & Kaller, serves as an independent board member at Charter, along with W. Lance Conn, a former attorney at a predecessor firm of Pillsbury Winthrop Shaw Pittman.
TWC’s top ranks also include those with Am Law 100 ties. Former Paul Weiss partner and Time Warner general counsel Peter Haje sits on the company’s board, as does Akin Gump Strauss Hauer & Feld adjunct senior policy adviser John Sununu, a former U.S. senator from New Hampshire.
U.S. Senate records show that TWC paid $10,000 to Dentons for privacy and broadband public policy counsel in the third quarter of 2013—around the time that Edwards Wildman Palmer also registered to lobby for the company on retransmission issues, according to sibling publication The Blog of Legal Times. The Am Law Daily reported in October on Edwards Wildman’s role counseling TWC on its $600 million buy of fiber optic network provider DukeNet Communications.
Marc Lawrence-Apfelbaum, who began his career as an associate at Cravath, Swaine & Moore and recently won an ethical acts in journalism award, serves as TWC’s general counsel. His former firm has maintained a close relationship with TWC’s erstwhile parent, Time Warner Inc., which has also turned to Paul Weiss for some work. (Late Paul Weiss partner Arthur Liman was a longtime adviser to the Time Warner conglomerate.)
SEC filings show that Cravath has grabbed the lead role advising Time Warner—the world’s third-largest media conglomerate—on the proposed spin-off of its Time Inc. publishing unit, according to our previous reports. The division, the largest magazine publisher in the U.S. with titles like Fortune, People and Sports Illustrated, is set to become a new public company sometime this year after the collapse of tie-up talks with fellow magazine publisher Meredith Corp.
Sibling publication Corporate Counsel reported in November on Time Inc.’s hire of former News Corp. general counsel Lawrence Jacobs—a key individual in the phone-hacking scandal at Rupert Murdoch’s media giant—as its new legal chief, with predecessor Maurice Edelson transitioning to a new role as deputy general counsel of Time Warner.
Edelson will report directly to Time Warner general counsel Paul Cappuccio, a former Kirkland partner who became the top in-house lawyer at predecessor company AOL Time Warner back in 2000. Former Kirkland of counsel and retired Verizon Communications general counsel William Barr is an independent member of the board at Time Warner, along with Harvard Law School professor Robert Clark and ex-Mintz, Levin, Cohn, Ferris, Glovsky and Popeo partner Kenneth Novack.
In 2010, Time Warner hired former Simpson Thacher & Bartlett associate and ex-Clinton administration counsel Gary Ginsberg to serve as the company’s executive vice president of corporate marketing and communications. Senate filings show that Venable and Polsinelli split $120,000 in lobbying fees for Time Warner through the first three quarters of last year.