TWC Time Warner Cable

By Josh Beckerman 

The Federal Communications Commission approved Charter Communications Inc.'s $55 billion acquisition of Time Warner Cable Inc., with conditions.

In a brief statement, the agency said it would issue an order with more details in the coming days.

Federal regulators were expected to approve the deal after the FCC and Justice Department announced several conditions late last month that would force the merged company to live up to stringent obligations that don't apply to its bigger rivals.

Charter has agreed to abandon for seven years several common industry practices that the government feared could threaten the growth of rival online video providers such as Netflix Inc. and Hulu.

Charter agreed not to impose data caps or charge broadband Internet customers based on data usage. The company also will be required to build out its broadband access to two million homes.

"Many of the conditions either codified or reflected specific commitments Charter offered proactively at the beginning of the transaction review process," Charter said Friday.

The "significant benefits" of the acquisition include greater competition, more consumer-friendly broadband policies and added U.S. jobs, it said.

The tie-up will create the second-biggest broadband provider in the U.S., after Comcast Corp., and the third-largest pay-TV company. As part of the transaction, Charter also agreed to buy Bright House Networks for about $10.4 billion.

Charter jumped in with a bid last year after Comcast's proposed takeover of Time Warner Cable collapsed under regulatory scrutiny.

AT&T Inc. became the No. 1 pay-TV provider when it closed its purchase of DirecTV in July.

In a rapidly consolidating industry, the fifth-largest U.S. cable company, Cablevision Systems Corp., is in the process of a $10 billion sale to Altice NV.

From imposing utility-style "net neutrality" rules to recently pushing to open up the market for set-top boxes, the White House and the FCC led by Chairman Tom Wheeler have sought to break down the barriers for new competitors to take on pay-TV providers, siding with the likes of Netflix and Alphabet Inc.'s Google.

The California Public Utilities Commission is scheduled to vote on the Charter deal on May 12.

Charter shares closed up 90 cents at $212.92 on Friday, while Time Warner Cable added 64 cents at $213.16.

--Shalini Ramachandran and John D. McKinnon contributed to this article

Write to Josh Beckerman at josh.beckerman@wsj.com

(END) Dow Jones Newswires

May 06, 2016 17:01 ET (21:01 GMT)

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