This past week saw job cuts, a colossal multibillion-dollar acquisition, and The Rock dominate, once again, the box office with his latest earthquake disaster film, San Andreas. What else happened in the world of business over the last week? Check out the list below.
1. Charter Communications Buys Time Warner Cable
One month after Comcast decided to step away from a deal that would see it acquire Time Warner Cable (TWC), Charter Communication has decided to acquire the major telecom provider.
Charter has agreed to purchase TWC in a deal that values the company at $78.7 billion. Charter will pay TWC $55 billion in cash and stock with the remaining $23.7 billion coming from the company’s debts.
The proposal would see the second and third largest cable companies in the United States merge. Moreover, Charter is buying up cable operator Bright House Networks for about $10.4 billion. This means the three companies will offer cable and broadband Internet to roughly 24 million customers across 41 states, and compete against Comcast and its 27 million customers.
Experts concur that this move is part of a much bigger picture. Cable companies in most countries are facing tough competition from the likes of Amazon and Netflix because its subscribers are spending less to access the same television shows and films. So, one measure to lessen the blow is to reduce costs, and a merger helps accomplish this.
The deal hasn’t closed yet because it still faces regulatory scrutiny from the Federal Communications Commission (FCC) which released a statement soon after the story began to make headlines:
"The FCC reviews every merger on its merits and determines whether it would be in the public interest," FCC chairman Tom Wheeler said in the statement. "In applying the public interest test, an absence of harm is not sufficient. The Commission will look to see how American consumers would benefit if the deal were to be approved.”
2. JPMorgan Chase to Slash 5,000 Jobs
JPMorgan Chase turned heads last week when a source told Dow Jones that the Wall Street titan will be cutting 5,000 jobs by next year as part of a cost-cutting initiative. This includes the finance firm relying more on technology instead of humans.
It was reported that the latest round of layoffs took place earlier this year as the bank slashed at least 1,000 positions. Overall, the job cuts would diminish the company’s workforce by around two percent.
This shouldn’t come as a surprise, though. Chairman and CEO Jamie Dimon warned that at each of its 5,570 branches there would be a loss of at least one employee throughout the next couple of years. Moreover, JPMorgan cut 7,900 mortgage jobs last year and minimized its workforce to an estimated 240,000.
Despite reductions in its workforce, JPMorgan hires about 40,000 employees every year.
JPMorgan isn’t the only financial institutions to slash jobs. Bank of America and Citigroup have also cut positions in the last year, citing automation, legal concerns, and a tough regulatory environment.
3. Snapchat Raises Big Bucks During Funding Round
Snapchat, a social media app popular among teens and young adults, raised $537 million in the latest funding round. Regulatory filings suggest that Snapchat could be closing in on $650 million as it approaches a hefty initial public offering (IPO).
Not bad for a company that maintains 100 million active users daily.
A wide variety of investors poured money into Snapchat during this latest round, such as Alibaba, Yahoo! and an array of venture capital organizations. Snapchat is mostly selling common stock because investors want their portfolios to consist of hyper-growth tech firms.
To date, Snapchat has captured approximately $1.2 billion in outside funding. Analysts are pegging the company’s valuation to be more than $15 billion. This is the same company that turned down Facebook’s billion-dollar buyout offer.
Snapchat CEO Evan Spiegel has confirmed that it is indeed seeking an IPO, but has vowed to remain independent and will not be purchased by other tech giants like Facebook.
4. A $100,000 Check Awaits for Woman
Everyone is on the lookout for a San Francisco woman who recently dropped off a rare 1976 Apple I at an e-recycling waste firm. Why is everyone searching for her? Well, the computer is worth an estimated $200,000 – CleanBayArea’s policy is to split 50-50 with the customer, so a $100,000 check is waiting for her upon her return.
According to USA Today, the woman told the staff members several weeks ago that her husband recently passed away and that she wanted to clear out her garage. The unknown woman did not leave her name nor did she ask for a tax deductible receipt.
The company’s employees were searching through their inventory of boxes and were amazed to discover the computer in which there were only 200 ever made. Steve Wozniak, Apple’s co-founder, designed and hand-built the computers and sold each one for more than $600.
It’s unclear if the newsworthy computer still works.
Victor Gichun, vice president of marketing for CleanBayArea, said he will recognize her and believes she is a local resident.
5. The Rock Shakes Box Office
The box office Richter scale was through the roof this weekend, as the earthquake disaster movie, starring Dwayne "The Rock" Johnson, San Andreas generated almost $55 million in domestic ticket receipts. This is actually $13 million more than what experts had been anticipating.
Despite the enormous box office sales, San Andreas maintains a 48 percent fresh rating on Rotten Tomatoes. A lot of reviewers are writing the same thing: the movie is fun to watch, but be sure to check your brain in at the door. In other words: a lot of action, little scientific substance.
Meanwhile, this is the biggest opening for Johnson’s acting career in which he was the star. Hercules turned out to be a dud for the former WWE Champion, according to critics – though the film did garner $250 million in global ticket sales on a $100 million production budget.
Although his films have grossed $6 billion worldwide, much of that success has been due to films where he played a support role. Fast and the Furious and G.I. Joe were huge hits, but he wasn’t the lead.
There is no doubt that Johnson is a major box office attraction. Whether it’s improving upon franchises or creating new projects on his own, Johnson remains one of the biggest stars in Hollywood today.
Which headlines from last week stood out to you? Let us know in the comments section below!