The Latest Content Pick: Verizon For Charter?

Shares of Charter Communications, Inc. CHTR were trading higher by more than 10 percent ahead of Thursday's market open following a Dow Jones report that suggested the company is seeking a combination with Verizon Communications Inc. VZ.

At the same time, shares of Verizon were lower by around 1.50 percent.

The Dow Jones report did note that efforts between the two companies to merge are in the preliminary stages and may not result in a deal.

Charter told Benzinga in a statement that they are not commenting on the Dow Jones report of Verizon approaching the company for a potential combination.

Around 10:03 a.m. ET, Reuters reported that Verizon has not proposed an acquisition.

Strategy

However, the logic and rationale behind this deal is consistent with the ongoing blurring line between TV cable, entertainment providers and mobile companies. In fact, the regulatory environment under the new Federal Communications Commission chairman Ajit Pai is seen to be "very anti-regulation, pro free markets" and "very bullish for cable."

Charter is the second-largest cable operator in the United States and is also the fifth largest telephone provider.

One Among Many?

Other similar business combinations seen very recently include AT&T Inc. T proposed acquisition of Time Warner Inc TWX and even Verizon's acquisition of Yahoo! Inc. YHOO's internet properties.

The New York Post reported on January 17 that Verizon might be considering an acquisition of a big cable company to counter a very large potential competitor which would bring together AT&T, Time Warner and DirecTV under one entity.

Sources close to the matter told the New York Post that Verizon would likely target Charter or Comcast Corporation CMCSA although the report did add that Verizon is not in talks with any cable company and may not ever make such a move.

Image Credit: By Dwight Burdette (Own work) [CC BY 3.0], via Wikimedia Commons