Charter agrees all-stock Liberty Broadband deal at 0.236 exchange ratio

Charter Communications said Wednesday it had reached an all-stock agreement to acquire Liberty Broadband, setting an exchange ratio of 0.236 Charter share for each Liberty share. Based on Tuesday’s closing prices, MarketWatch reported that the terms implied $92.51 for each Liberty share, a 5.2% discount to the closing price of Liberty’s Class C stock.

The agreed ratio is higher than Charter’s earlier proposal of 0.228 Charter share for each Liberty share, but below Liberty Broadband’s counteroffer of 0.29, according to the companies’ prior proposals cited by MarketWatch. The transaction covers all classes of Liberty Broadband shares.

The structure is a stock-for-stock acquisition, meaning Liberty holders would receive Charter equity rather than cash consideration. That mechanism links the final economic value received by Liberty shareholders to Charter’s share price at closing, unless the agreement includes protections not described in the announcement reported by MarketWatch.

Deal simplifies Liberty’s Charter exposure

Liberty Broadband’s principal assets include 45.6 million Charter common shares and GCI, LLC, which MarketWatch described as Alaska’s largest communications provider. Charter expects to retire the Charter shares held through Liberty after the transaction closes and to issue 34 million Charter shares to Liberty shareholders.

That share retirement is central to the transaction’s design. By acquiring Liberty, Charter would absorb an entity whose value is tied heavily to Charter stock, cancel the Charter shares held inside Liberty, and replace them with newly issued Charter shares distributed to Liberty investors. The result would reduce a holding-company layer between Liberty shareholders and Charter equity.

Charter said the closing is currently expected on June 30, 2027. The timing indicates a long path to completion relative to many public-company mergers, although the reported announcement did not provide further conditions or regulatory details.

Liberty Chairman John Malone said the transaction would address Liberty Broadband’s trading discount and give shareholders improved liquidity. “Today’s announced transaction will rationalize Liberty Broadband’s trading discount and ultimately provide our shareholders with enhanced liquidity,” Malone said, according to MarketWatch.

Market context

Charter shares were quoted down 1.89% in MarketWatch’s ticker display, while Liberty Broadband’s Class C and Class A shares were each shown down 1.83%. Liberty Broadband preferred shares were shown down 0.41%.

The agreement follows a negotiation in which Charter first offered 0.228 Charter share per Liberty share and Liberty responded with a higher proposed ratio of 0.29. The final 0.236 ratio places the agreed terms nearer to Charter’s initial position than to Liberty’s counterproposal, while still improving on Charter’s first offer.

Charter Communications is a major U.S. cable and broadband operator. Liberty Broadband has long been associated with an ownership interest in Charter, and the agreed transaction would convert Liberty holders’ indirect exposure into direct Charter shares if completed under the announced terms.

This story draws on original reporting from MarketWatch.