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Malone Seen Stalking Time Warner Cable Merger: Real M&A

Liberty Media Corp.’s investment in Charter Communications Inc. may be billionaire John Malone’s first move in a multi-year chess game to consolidate the U.S. cable industry.

Higher programming costs and fewer new customers have crimped video profit margins, making mergers appealing, Liberty Media Chairman Malone said at his annual shareholder meeting last week. More than 100 million U.S. households already subscribe to pay-TV, and major cable providers have lost TV customers for at least five years, according to data compiled by Bloomberg. Malone said Charter -- the fourth-largest U.S. cable operator, in which Liberty Media bought a 27 percent stake -- can be “a horizontal acquisition machine.”