The Charter Communications Inc. and the Time Warmer Cable Inc. are planning to merge as communicated by the top executive of the two companies. According to Charter chief executive Rutledge Tom, the company pledged $55billion to acquire Time Warmer Cable and invest in the newest broadband products. Once the two companies merge, they will control a large internet and cable markets and supply their products to many consumers. The Federal Communications Commission must consider the benefits of the merger to the American consumers before approving the deal. Once the companies merge thy will have control of about one-fifth of the US broadband Internet market as reports from research firm Moffett Nathanson shows.

The merger is the combination of two or more companies where the acquiring company takes over the stockholders of the other company. The article on merging is important as it relates to the issues learned in class such as marketing and consumer information. The merging companies with have a pool of consumers to offer their products since the two will contribute their former customers in addition to acquiring new ones. The merging represented by the two companies is a horizontal merger in which the two are operating at the same level. The agreement was friendly, and the two companies’ management did so after a lengthy discussion. The acquiring company is Charter Communications Inc. and pledged to pay $55 billion to the target company, which Time Warmer Cable Inc. is merging is a complex process involving the interested entities and the law enforcers for legality purposes. The legal audit helps the shareholders determine the economic risks involved after the merger companies come together.

The two companies that have decided to merge will enjoy various benefits to market their product and control a large market. The merging will help secure additional and high skilled employees who will help in the management of the company. The merged companies have access to funds and valuable assets to enhance the development of their newly formed company. Customers are assets to any business organization and merging of two or more businesses will provide a large customer base for their products. The newly formed company after the merging of Charter Communications Inc. and the Time Warmer Cable Inc will share all the costs and overheads thereby reducing competition and any expenses on associated with buying of new property or paying for services.

The article is very important as it provides an insight of marketing strategies by companies operating in the same level of production. The Charter Communications Inc. and the Time Warmer Cable Inc. will enjoy the benefits associated with merging such as a pool of customers and a large market for their products. The legal procedures for the two companies to merge are very important to secure the interest of the shareholders. The other benefits are acquiring more assets and skills that will help in management and expansion of the entities. Once all legal formalities are complete, and the acquiring pays the agreed amount, the two will operate as one and enjoy the economies of scale.

References

Ramachandranand, S., & Nagesh, G. (2015). Charter to D.C.: We’re No Comcast. The Wall Street Journal. Retrieved from http://www.wsj.com/articles/charter-positioning-twc-merger-for-washington-1432656619?mod=pls_whats_news_us_business_f