Charter Agrees to $55 Billion Purchase of Time Warner Cable

Charter Communications Inc. plans to buy Time Warner Cable Inc., clinching a deal made necessary by slowing growth in the U.S. cable industry—and more expensive by last-minute competition from French billionaire Patrick Drahi.

Charter will pay $195.71 a share—14 percent above Time Warner Cable’s May 22 close—with options of $100 and $115 in cash and the remainder in its own stock, according to a statement May 26. Bright House Networks, a smaller cable company that Charter has previously agreed to buy, will also be merged into the combined entity.

It took Charter and its main shareholder, John Malone, more than ...