By Ben Dummett
Comcast's planned breakup is sending Charter Communications' stock soaring.
The cable giant plans to spin off NBCUniversal and Sky operations, leaving Comcast to focus on broadband, wireless and cable. That has investors betting on the prospect of Comcast acquiring Charter after the split's completion to bolster its broadband operations amid the prospect of growing competition.
"The core regulatory questions [for a potential bid] become cleaner: broadband concentration, local market overlap, wireless bundling and the FCC public interest review," research firm MKI Global Partners said in a note today.
That's not to say a bid would be inevitable. Charter has market value of more than $18 billion, which makes it big bit for any potential acquirer. The deal would also invite political scrutiny, MKI said.
Charter is already at the forefront of consolidation in the sector. It's in the process of acquiring rival Cox Communications. The company has also agreed to buy its largest shareholder, Liberty Broadband, in an all-stock deal.
Broadband companies, under threat from wireless operators as well as satellite providers, such as Elon Musk's Starlink satellite connectivity company, face increased pressure to gain scale.
Case in point: On the same day Comcast announced its split, Rocket Lab struck a $8 billion deal to buy Iridium Communications, a satellite operator.
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