Earlier today, Comcast Cable announced that it agreed to acquire Time Warner Cable in a $45 billion mega-deal.
What's in it for Comcast Cable shareholders?
"This combination creates a company that delivers maximum value for our shareholders," said Comcast CEO Brian Roberts.
How are they going to do that?
The company explains in one sentence that probably has every Comcast and Time Warner Cable employee nervous.
"The transaction will generate approximately $1.5 billion in operating efficiencies and will be accretive to Comcast’s free cash flow per share while preserving balance sheet strength."
"Operating efficiencies" usually means the closing and combining offices, which also often comes with job cuts.
For now, management is doing and saying what they can to keep everyone calm.
“The combination of Time Warner Cable and Comcast creates an exciting opportunity for our company, for our customers, and for our shareholders,” said Comcast CEO Brian Roberts.
“This combination creates a company that delivers maximum value for our shareholders, enormous opportunities for our employees and a superior experience for our customers,” said Time Warner Cable CEO Robert Marcus.
Comcast employs around 136,000 workers while Time Warner Cable employs around 34,000.
Assuming half of those operating efficiencies ($750 million) come from reduced headcount and each worker saves $150,000, this back-of-the-envelope calculation would see 5,000 employees being let go.
The companies haven't actually announced or quantified and reductions in headcount just yet. But you can bet that announcement is coming.
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