Comcast today announced a pair of moves that will rid it of a combined 3.9 million subscribers, in an attempt to make its Time Warner merger sit more easily with regulators. Comcast will sell 1.4 million subscribers to rival (and previous Time Warner suitor) Charter Communications for $7.3 billion, the Wall Street Journal reports, making Charter the second-largest pay TV company. It will also spin off a new publicly traded company—so far known appropriately enough as "SpinCo"—and hand it 2.5 million subscribers.
SpinCo will initially be two-thirds owned by Comcast shareholders, and one-third owned by Charter. All the moves are contingent on regulators approving the Time Warner takeover. "Comcast wanted to do this deal now with Charter so it could get in front of regulators ... at the same time as the Time Warner Cable deal," one source tells Reuters. For Charter, an analyst said, this is "a transformative event and sets them up over time to consolidate … the rest of the cable industry." (Read more Comcast stories.)