Rumor: Time Warner Cable To Take $1 Billion Dodgers Writedown
Time Warner Cable Inc (NYSE: TWC) will take a $1 billion write-down on its troubled 25-year deal to televise the Los Angeles Dodgers baseball games, according to a speculative report Tuesday.
Time Warner, set to be acquired for $45 billion by Comcast Corporation (NASDAQ: CMCSA), is trying to "clean up the mess" related to the Dodgers deal as a condition of the merger, according to the New York Post.
Time Warner Cable last year paid $8.35 billion in a 25-year deal for distribution rights for Dodgers' games.
But local TV outlets balked at the $5-per subscriber price sought by Time Warner, and 70 percent of homes in the Southern California TV market had no access during the 2014 season.
Unnamed sources told The Post that the market rate for the channel is more likely $3 per subscriber per month, "meaning the charge will be almost $1 billion when adjusted over the life of the contract," according to the newspaper.
Shares of Time Warner traded recently at $151.01, down 2.9 percent.
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