Business

A Decade-Long Search for a Battery That Can End the Gasoline Era

Published

2 weeks ago

May 9, 2025

A Decade-Long Search for a Battery That Can End the Gasoline Era

On a frigid day in early January, as she worked in her office in the Boston suburb of Billerica, Mass., Siyu Huang received a two-word text message.

“Spinning wheels,” it said. Attached was a short video clip showing a car on rollers in an indoor testing center.

To the untrained eye there was nothing remarkable in the video. The car could have been getting its emissions tested at a Connecticut auto repair shop (except it had no tailpipe). But to Ms. Huang, the chief executive of Factorial Energy, the video was a milestone in a quest that had already occupied a decade of her life.

Ms. Huang, her husband, Alex Yu, and their employees at Factorial had been working on a new kind of electric vehicle battery, known as solid state, that could turn the auto industry on its head in a few years — if a daunting number of technical challenges could be overcome.

For Ms. Huang and her company, the battery had the potential to change the way consumers think about electric vehicles, give the United States and Europe a leg up on China, and help save the planet.

Factorial is one of dozens of companies trying to invent batteries that can charge faster, go farther, and make electric cars cheaper and more convenient than gasoline vehicles. Transportation is the biggest source of man-made greenhouse gases, and electric vehicles could be a potent weapon against climate change and urban air pollution.

The video that landed in Ms. Huang’s phone was from Uwe Keller, the head of battery development at Mercedes-Benz, which had been supporting Factorial’s research with money and expertise.

The short clip, of a Mercedes sedan at a research lab near Stuttgart, Germany, signaled that the company had installed Factorial’s battery in a car — and that it could actually make the wheels move.

The test was an important step forward in a journey that had begun while Ms. Huang and Mr. Yu were still graduate students at Cornell University. Until then, all their work had been in laboratories. Ms. Huang was excited that their invention was venturing into the world.

But there was still a long way to go. The Mercedes with a Factorial battery hadn’t yet been taken out on the road. That was the only place the technology really mattered.

Many start-ups have produced solid-state battery prototypes. But no American or European carmaker has put one into a production vehicle and proved that the technology could survive the bumps, vibrations and moisture of the streets. Or if any have, they have kept it a secret.

In late 2023, Mr. Keller, a veteran Mercedes engineer, proposed to Ms. Huang that they try.

“We’re car guys,” Mr. Keller said later. “We believe in things really moving.”

Roots in China

Ms. Huang stands out in a niche dominated by men from Silicon Valley. Some brag about their 100-hour workweeks; she believes in a good night’s sleep. “Having a clear mind to make the right decision is more important than how many hours you work,” she said.

She is approachable and laughs easily, but also projects determination. She works from a sparsely decorated office in Billerica that looks out on a patch of forest crossed by power lines. The furnishings include a plain black bookcase, stocked with a few technical volumes, that she inherited from a previous tenant. Her diplomas from Cornell — a Ph.D. in chemistry and a master’s in business administration — hang on the wall.

Ms. Huang grew up in Nanjing, China, where she was in an elementary school program that had her gather environmental data. The program instilled an interest in chemistry and an awareness of the vehicle exhaust and industrial pollution choking Nanjing’s air. She realized, she recalled, that “we need to grow a planet that’s healthier for human beings.”

In a dormitory at Xiamen University on China’s southern coast, where she studied chemistry, she saw an advertisement for a Swedish exchange program. After spending two years there, she and Alex, whom she had known since they were students in China, were both accepted to doctoral programs in Cornell’s chemistry department. She arrived in Ithaca, N.Y., in 2009 with $3,000, which she had managed to save from her Swedish scholarship. They have both since become U.S. citizens.

They were star students, said Héctor Abruña, a professor at Cornell known for his research in electrochemistry. He still has a picture on his office bookshelf of himself with Mr. Yu and Ms. Huang in their commencement robes.

With an idea that grew out of Dr. Abruña’s lab and some seed money from the State of New York, Mr. Yu and Ms. Huang founded the company that later became Factorial while she was still completing her business degree.

“They are extremely dedicated and extremely bright,” said Dr. Abruña, who continues to advise Factorial. “Straight shooters — zero BS.”

Mr. Yu is now Factorial’s chief technology officer. The company is, in that sense, a family operation. Ms. Huang is reticent about their private life, declining to say even how many children they have.

Initially the company focused on improving the materials that allow batteries to store energy. That changed after Mercedes invested in Factorial in 2021. Mercedes was looking for a bigger technological leap and encouraged Factorial to pursue solid state.

The technology has that name because it eliminates the liquid chemical mixture, known as an electrolyte, that helps transport energy-laden ions inside a battery. Liquid electrolytes are highly flammable. Replacing them with a solid or gelatinlike electrolyte makes batteries safer.

A battery that doesn’t overheat can be charged faster, perhaps in as little time as it takes to fill a car with gasoline. And solid-state batteries pack more energy into a smaller space, reducing weight and increasing range.

But solid-state batteries have one big drawback that explains why you can’t buy a car with one today. Such battery cells are more prone to grow spiky irregularities that cause short circuits. Vast riches await any company that can overcome this problem and develop a battery that is durable, safe and reasonably easy to manufacture.

Despite obvious differences between Factorial and Mercedes — the start-up has a little more than 100 employees, compared with 175,000 — Ms. Huang’s working style meshed with the culture at Mercedes and its roots in Swabia, the region around Stuttgart where people are known for their no-nonsense approach and restraint.

Mr. Keller found Ms. Huang’s low-key, factual manner to be a welcome contrast to the hype and unfulfilled promises that are pervasive in the battery and technology industries. Factorial, he said, “has not been announcing, announcing, announcing and not delivering.”

‘Production hell’

It’s an axiom in the battery business that producing a cool prototype is the easy part. The challenge is figuring out how to make millions of solid-state batteries at a reasonable price.

Factorial confronted that problem in 2022, setting up a small pilot factory in Cheonan, South Korea, a city near Seoul known for its tech industry. The project became, in Ms. Huang’s words, “production hell” — the same phrase Elon Musk used when Tesla was struggling to mass-produce a sedan and nearly went bankrupt.

To make money, a battery factory can’t produce too many defective cells. Ideally the yield, the percentage of usable cells, should be at least 95 percent. Hitting that target is devilishly difficult, involving volatile chemicals and fragile separators layered and packaged into cells with zero margin for error. The machinery doing all this is encased in Plexiglas chambers and overseen by workers dressed in head-to-toe protective gear to prevent contamination.

Dozens of companies are trying to mass-produce solid-state cells, including big carmakers like Toyota and smaller ones like QuantumScape, a Silicon Valley start-up backed by Volkswagen. Mercedes, hedging its bets, is also working with ProLogium, a Taiwanese company.

Nio, a Chinese carmaker, sells a vehicle with what it advertises as a solid-state battery. Analysts say the technology is less advanced than what Factorial is developing, offering fewer advantages in weight and performance. But there is little doubt that Chinese companies are investing heavily in solid state. Nio did not respond to a request for comment.

Every company has its own closely guarded recipes and manufacturing processes. “It’s difficult to say which technology will win,” said Xiaoxi He, a technology analyst at IDTechEx, a research firm.

Partly because solid-state batteries are so difficult to manufacture, many auto executives are skeptical that they will make commercial sense anytime soon. Shares in many solid-state battery start-ups have plunged, and management turmoil is common.

Factorial has insulated itself from the harsh judgments of Wall Street by never selling stock. Its funding comes from private investors including WAVE Equity Partners, a Boston firm, and partners that include the South Korean automaker Hyundai Motor; and Stellantis, which next year plans to test Factorial batteries in Dodge Charger muscle cars. It also has a partnership with LG Chem, a South Korean company that makes battery materials.

Projections of how soon solid-state batteries would be available have proved overly optimistic. Toyota displayed a futuristic prototype in 2020, but the company is still years away from selling a car with a solid-state battery.

Kurt Kelty, a vice president at General Motors in charge of batteries, is among those who will believe it when they see it. “We’re not banking on solid state,” Mr. Kelty said.

‘I don’t even know if we can make it’

In the beginning, Factorial’s prototype assembly line in South Korea had a yield of just 10 percent, meaning 90 percent of its batteries were faulty. Despite her preference for a good night’s sleep, Ms. Huang often had to wake up at 4 a.m. to deal with problems at the factory, which was operating around the clock. She was in South Korea at least once a month.

“There were always issues,” she said. “There was a point, I was like, I don’t even know if we can make it.”

By 2023, Factorial had produced enough cells suitable for an automobile that Mr. Keller, a soft-spoken, amiable man who has worked at Mercedes for 25 years, began thinking about installing them in a car. The cost and the risk of failure were high enough that he sought approval from his bosses. Armed with PowerPoint slides, Mr. Keller went to Ola Källenius, an imposing Swede who is chief executive at Mercedes.

Mr. Källenius’s office is at the top of a glass and steel high-rise in the middle of a sprawling manufacturing and development complex beside the Neckar River in Stuttgart.

Mr. Keller argued that road testing would help determine, among other things, whether the batteries would work with air cooling alone. If so, that would eliminate the need for a heavier, more costly liquid-cooled system.

Mr. Källenius signed off on the project, reasoning that a tangible goal would motivate the team and hasten development. He drew an analogy to Formula 1 racing. “If you’re chasing the leader, and suddenly you can see him, you get faster,” Mr. Källenius recalled.

Ms. Huang was a bit surprised when, in late 2023, Mr. Keller told her that Mercedes wanted to put the cells in a working vehicle. “We didn’t realize it was coming so soon, honestly speaking,” she said with a laugh.

But by June 2024, Factorial had managed to produce enough high-quality cells to announce that it had begun delivering them to Mercedes. In November, the factory in South Korea hit 85 percent yield, the best result yet. Ms. Huang and the Korean team celebrated by going out to a barbecue joint.

Mercedes still had to figure out how to package the cells in a way that would protect them from highway dirt and moisture. And it had to integrate the battery pack into a vehicle, connecting it to the car’s control systems.

The Factorial cells had one big drawback that made them hard to install in a car. They expanded when charged and shrank when discharged. In Mr. Keller’s words, they “breathed.”

Mr. Keller turned to engineers on the Mercedes Formula 1 racing team, who are accustomed to quickly solving technical problems. They devised a mechanism that expanded and shrank with the cells, maintaining constant pressure.

By Christmas 2024, a team working at Mercedes’s main research center in Sindelfingen, outside Stuttgart, texted Mr. Keller those two words: “spinning wheels.”

‘Finally I see you’

Mr. Keller confessed that he got a little emotional when his team sent him the video of the car. He waited until after Christmas to forward it to Ms. Huang with the same two words.

Several weeks later, the Mercedes engineers took the car with Factorial’s battery, an otherwise standard EQS electric sedan, to a company track for its first road test.

The engineers drove the car slowly at first. They carefully monitored technical data displayed on the dashboard screen.

They drove faster and faster until, by the fourth day, they reached autobahn speeds of 100 miles per hour. The battery didn’t blow up. In theory, it can power the car for 600 miles, more than most conventional cars can travel on a tank of gasoline.

Mr. Keller had been keeping Ms. Huang apprised of the progress, but she was still surprised when, during a meeting on marketing strategy in February, people from the Mercedes communications department mentioned that they had written a news release announcing the achievement.

“Do you want to take a look?” they asked.

She certainly did. The first successful road test with a Factorial battery was an enormously important moment, one they had been anticipating for years. Yet the teams at Mercedes and Factorial did not throw parties to celebrate. They still had work to do.

The next step is to equip a fleet of Mercedes vehicles with batteries, perfect the manufacturing process and do the testing required to begin selling them. That will probably take until 2028, at least. Many experts don’t expect cars with solid-state batteries to be widely available until 2030, at the earliest.

In April, Ms. Huang finally found time to travel to Stuttgart and ride in the car herself.

It was a clear spring day, with greenery sprouting in the German countryside and flowers beginning to bloom. Mercedes employees escorted her to a garage in Sindelfingen, where the automaker also has a large factory complex.

Ms. Huang had seen many photos of the car, but she still felt a thrill when the garage doors opened. It felt “like a long-lost friend,” she said. “Like, ‘Finally I see you!’”

A Mercedes driver took her for a spin on the test track, zooming down an asphalt straightaway then around a banked curve that, Ms. Huang said, felt like a roller coaster.

Inside the car, there was no way to perceive the difference with the Factorial battery compared with a conventional one. “But it’s just so special because it’s with our battery.”

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Business

23andMe sells gene-testing business to DNA drug maker Regeneron

Published

16 hours ago

May 19, 2025

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23andMe sells gene-testing business to DNA drug maker Regeneron

Bankrupt genetic-testing firm 23andMe agreed to sell its data bank, which once contained DNA samples from about 15 million people, to the drug developer Regeneron Pharmaceuticals for $256 million.

The sale comes after a wave of customers and government officials demanded that 23andMe protect the genetic data it had built up over the years by collecting saliva samples from customers.

Regeneron pledged to comply with 23andMe’s privacy policy, which allows customers to have their personal information deleted upon request.

“We have deep experience with large-scale data management,” Regeneron co-founder George D. Yancopoulos said in a statement. The company “has a proven track record of safeguarding the genetic data of people across the globe, and, with their consent, using this data to pursue discoveries that benefit science and society.”

23andMe filed for bankruptcy in March after failing to generate sustainable profits by providing medical and ancestry-related genetic testing to more than 15 million customers.

About 550,000 people had subscribed to the company’s two primary services, which hasn’t been enough to keep the company afloat. One of those services, Lemonaid Health, was not part of the sale and will be wound down, 23andMe said in a statement.

As part of 23andMe’s Chapter 11 bankruptcy, a judge approved the appointment of a privacy ombudsman to monitor the sale process and ensure compliance with privacy policies related to the genetic material submitted by customers.

That material, and the genetic data it produced, was 23andMe’s most valuable asset. The company has said any buyer must comply with current privacy protections and federal regulations.

Regeneron said it will continue to run 23andMe’s personal genomic services once the sale closes. The judge overseeing the bankruptcy must approve the sale before it can be completed.

In the months leading up its bankruptcy, 23andMe tried to attract a buyer while struggling to end a class-action lawsuit related to a 2023 data breach that gave hackers access to customer information. The company will try to resolve those claims as part of the bankruptcy.

The case is 23andMe Holding Co., number 25-40976, in the U.S. Bankruptcy Court for the Eastern District of Missouri.

Church and Smith write for Bloomberg.

Business

Edison’s safety record declined last year. Executive bonuses rose anyway

Published

1 day ago

May 18, 2025

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Edison’s safety record declined last year. Executive bonuses rose anyway

The state law that shielded Southern California Edison and other utilities from liability for wildfires sparked by their equipment came with a catch: Top utility executives would be forced to take a pay cut if their company’s safety record declined.

Edison’s safety record did decline last year. The number of fires sparked by its equipment soared to 178, from 90 the year before and 39% above the five-year average.

Serious injuries suffered by employees jumped by 56% over the average. Five contractors working on its electric system died.

As a result of that performance, the utility’s parent company, Edison International, cut executive bonuses awarded for the 2024 year, it told California regulators in an April 1 report.

For Edison International employees, planned executive cash bonuses were cut by 5%, and executives at Southern California Edison saw their bonuses shrink by 3%, said Sergey Trakhtenberg, a compensation specialist for the company.

But cash bonuses for four of Edison’s top five executives actually rose last year, by as much as 17%, according to a separate March report by Edison to federal regulators. Their long-term bonuses of stock and options, which are far more valuable and not tied to safety, also rose.

Of the top five executives, only Pedro Pizarro, chief executive of Edison International, saw his cash bonus decline. He received a cash bonus of 128% of his salary rather than the planned 135% because of the safety failures, the company said, for total compensation including salary of $13.8 million.

The cash bonuses increased for the other top four executives despite the safety-related deductions because of how they performed on other responsibilities, said Trakhtenberg, Edison’s director of total rewards. He said bonuses would have been higher were it not for safety-related reductions.

“Compensation is structured to promote safety,” Trakhtenberg said, calling it “the main focus of the company.”

Consumer advocates say the fact that bonuses increased in spite of the decline in safety highlights a flaw in AB 1054, the 2019 law that reduced the liability of for-profit utility companies like Edison for damaging wildfires ignited by their equipment.

AB 1054 created a wildfire fund to pay for fire damages in an effort to ensure that utilities wouldn’t be rendered insolvent by having to bear billions of dollars in damage costs.

In return, the legislation said executive bonus plans for utilities should be “structured to promote safety as a priority and to ensure public safety and utility financial stability.”

“All these supposed accountability measures that were put into the bill are turning out to be toothless,” said Mark Toney, executive director of The Utility Reform Network, a consumer advocacy group in San Francisco.

“If executives aren’t feeling a significant reduction in salary when there is a significant increase in wildfire safety incidents,” Toney said, “then the incentive is gone.”

One of the executives who received an increased cash bonus was Adam Umanoff, Edison’s general counsel.

Umanoff was expected to get 85% of his $706,000 salary, or $600,000, as a cash bonus as his target at the year’s beginning. The deduction for safety failures reduced that bonus, Trakhtenberg said. But Umanoff’s performance on other goals “was significantly above target” and thus increased his cash bonus to 101% of his salary.

So despite the safety failures, Umanoff received a cash bonus of $717,000, or 19% higher than he was expected to receive.

“If you can just make it up somewhere else,” Toney said, “the incentive is gone.”

The utility recently told its investors that AB 1054 will protect it from potential liabilities of billions of dollars if its equipment is found to have sparked the Eaton fire on Jan. 7, resulting in 18 deaths and the destruction of thousands of homes and commercial buildings.

The cause of the blaze, which videos captured igniting under one of Edison’s transmission towers, is still under investigation. Pizarro has said the reenergization of an idle transmission line is now a leading theory of what sparked the deadly fire.

The 2019 legislation was passed in a matter of weeks to bolster the financial health of the state’s for-profit electric companies after the Camp fire in Butte County, which was caused by a Pacific Gas & Electric transmission line.

The wildfire destroyed the town of Paradise and killed 85 people, and the damages helped push PG&E into bankruptcy.

At the bill-signing ceremony, Gov. Gavin Newsom touted its language that said utilities could not access the money in a new state wildfire fund and cap their liabilities from a blaze caused by their equipment unless they tied executive compensation to their safety performance.

In April, Edison filed its mandatory annual safety performance metrics report with the Public Utilities Commission as it seeks approval to raise customer electric rates by more than 10% this year.

In the report, Edison said that because its safety record worsened in 2024 on certain key metrics, its executives took “a total deduction of 18 points” on a 100-point scale used in determining bonuses.

“Safety and compliance are foundational to SCE, and events such as employee fatalities or serious injuries to the public can result in meaningful deduction or full elimination” of executive incentive compensation, the company wrote.

Edison didn’t explain in the report what an 18-point deduction meant to executives in actual dollar terms, another point of frustration with consumer advocates trying to determine if executive compensation plans genuinely comply with AB 1054.

“Without seeing dollar figures, it is impossible to ascertain whether a utility’s incentive compensation plan is reasonable,” the Public Advocates Office at the state Public Utilities Commission wrote in a 2022 letter to wildfire safety regulators.

To try to determine how much the missed safety goals actually impacted the compensation of Edison executives last year, The Times looked at a separate federal securities report Edison filed for investors known as the proxy statement.

In that March report, Edison detailed how the majority of its compensation to executives is based on its profit and stock price appreciation, and not safety.

Safety helps determine about 50% of the cash bonuses paid to executives each year, the report said. But more valuable are the long-term incentive bonuses, which are paid in shares of stock and stock options and are based on earnings.

The Utility Reform Network, which is also known as TURN, pointed to those stock bonuses in a 2021 letter to regulators where it questioned whether Edison and the state’s other two big for-profit utilities were actually tying executive compensation to safety.

“Good financial performance does not necessarily mean that the utility prioritizes safety,” TURN staff wrote in the letter.

Trakhtenberg disagreed, saying the company’s “long-term incentives are focused on promoting financial stability.” A key part of that is the company’s ability “over the long term to safely deliver reliable, affordable power,” he said.

Trakhtenberg noted that the state Office of Energy Infrastructure Safety had approved the company’s executive compensation plan in October, saying it met the requirements of AB 1054, as well as every year since the agency was established in July 2021.

The Times asked the energy safety office if it audited the utilities’ compensation reports or tried to determine how much money Edison executives lost because of the safety failures.

Sandy Cooney, a spokesman for the agency, said that the office had “no statutory authority … to audit executive compensation structures.” He referred the reporter to Edison for information on how much executive compensation had actually declined in dollar amounts because of the missed safety goals.

A committee of Edison board members determines what goals will be tied to safety, Trakhtenberg said, and whether those goals have been met.

Even though five contractors died last year while working on Edison’s electrical system, the committee didn’t include contractor safety as a goal, according to the company’s documents.

And the committee said the company met its goal in protecting the public even though three people died from its equipment and there was a 27% increase in deaths and serious injuries among the public compared to the five-year average.

Trakhtenberg said most of the serious injuries happened to people committing theft or vandalism, which is why the committee said the goal had been met.

Edison has told regulators that if its equipment starts a catastrophic wildfire, the committee could decide to eliminate executives’ cash bonuses.

But the company’s documents show that it hasn’t eliminated or even reduced bonuses for the 2022 Fairview fire in Riverside County, which killed two people, destroyed 22 homes and burned 28,000 acres.

In 2023, investigators blamed Edison’s equipment for igniting the fire, saying one of its conductors came in contact with a telecommunications cable, creating sparks that fell into vegetation.

Trakhtenberg said the board’s compensation committee reviewed the circumstances of the fire that year and found that the company had acted “prudently” in maintaining its equipment. The committee decided not to reduce executive bonuses for the fire, he said.

In March, the Public Utilities Commission fined Edison $2.2 million for the fire, saying it had violated four safety regulations, including by failing to cooperate with investigators.

Trakhtenberg said the compensation committee would reconsider its decision not to penalize executives for the deadly fire at its next meeting.

TURN has repeatedly asked regulators not to approve Edison’s compensation plans, detailing how its committee has “undue discretion” in setting goals and then determining whether they have been met.

But the energy safety office has approved the plans anyway. Toney said he believes the responsibility for reviewing the compensation plans and utilities’ wildfire safety should be transferred back to the Public Utilities Commission, which had done the work until 2021.

The energy safety office has rules that make the review process less transparent than it is at the commission, he said.

“The whole process, we feel is rigged heavily in favor of utilities,” he said.

Business

Cable giant Charter to buy Cox in a $34.5-billion deal, uniting providers that serve SoCal

Published

2 days ago

May 18, 2025

Press Room

Cable giant Charter to buy Cox in a .5-billion deal, uniting providers that serve SoCal

Charter Communications and Cox Communications plan to merge in a $34.5-billion deal that would unite Southern California’s two major cable TV and internet providers to sell services under the Spectrum brand.

The proposed consolidation, announced Friday, comes as the industry grapples with accelerating cable customer losses amid the shift to streaming.

The companies could face even more cord-cutting after their long-time programming partner, Walt Disney Co., begins offering its ESPN sports channel directly to fans in a stand-alone streaming service debuting this fall.

If approved by Charter shareholders and regulators, the merger would end one of the longest TV sports blackouts.

Cox customers in Rancho Palos Verdes, Rolling Hills Estates and Orange County would finally have the Dodgers’ TV channel available in their lineups. For more than a decade, Cox has refused to carry SportsNet LA because of its high cost.

Charter distributes the Dodgers channel as part of a $8.35-billion television contract signed with the team’s owners in 2013. Charter has bled hundreds of millions of dollars on that arrangement and now offers the channel more widely via a streaming app.

The Atlanta-based Cox is the nation’s third-largest cable company with more than 6.5 million digital cable, internet, telephone and home security customers. Stamford, Conn.-based Charter has more than 32 million customers.

Charter dramatically expanded its Los Angeles presence in 2016 by acquiring Time Warner Cable for more than $60 billion.

The Charter-Cox combination would have 38 million customer homes in the country — a larger footprint than longtime cable leader, Philadelphia’s Comcast Corp.

“This transformational transaction will create an industry leader in mobile and broadband communication services and seamless video entertainment,” Charter Chief Executive Christopher Winfrey said in a conference call with analysts.

Winfrey would become the proposed entity’s CEO.

A major motivation for the deal was to be able to combine operations in Los Angeles, Orange and San Diego counties where both services currently operate and add attractive markets like Phoenix, Winfrey told analysts.

“Our network will span approximately 46 states passing nearly 70 million homes and businesses,” Winfrey said.

Cox is privately held. The billionaire Cox family, descendants of an Ohio press baron who bought his first newspaper in 1898, began acquiring cable systems in 1962 and has since held them with a tight grip. The Cox cable assets were long seen as a lucrative target.

Last year, Cox generated $13.1 billion in revenue and $5.4 billion in adjusted earnings before interest, taxes, depreciation and amortization.

“Cox was always the first name that would come up in consolidation conversations… and it was always the first name dismissed,” longtime cable analyst Craig Moffett wrote in a Friday research note. “Cox wasn’t for sale.”

Until it was.

In an unexpected twist, the name of the merged company would be changed to Cox within a year of the deal closing. However, its products would carry the Spectrum moniker.

The Cox family would be the largest shareholder, owning about 23% of the combined entity’s outstanding shares.

Charter shares got a slight bump on Friday’s news, climbing nearly 2% to $427.25.

“Cable is a scale business. [The] added size should help Charter compete better with the larger telcos, tech companies and [Elon Musk’s] Starlink,” said Chris Marangi, co-chief investment officer of value at the New York-based Gabelli Funds, a large media investor.

Adding the Cox homes will allow Charter to expand distribution for its El Segundo-based Spectrum News channel.

Charter said it would absorb Cox’s commercial fiber, information technology and cloud businesses. Cox Enterprises agreed to contribute the residential cable business to Charter Holdings.

Cox Enterprises would be paid $4 billion in cash and receive about $6 billion in convertible preferred units, which could eventually be exchanged into Charter shares. The Cox family would get about 33.6 million common units in the Charter Holdings partnership, worth nearly $12 billion.

The combined entity will absorb Cox’s $12 billion in outstanding debt.

Charter’s ability to navigate the challenged landscape was a factor in the family’s decision, said Cox Enterprises Chief Executive Alex Taylor, a great-grandson of the company’s founder, told analysts.

“Charter has really impressed us above all others with the way they have spent capital,” Taylor said. “In the last five years, they’ve spent over $50 billion investing” in internet infrastructure and building a wireless phone service.

“This deal starts with mobile,” cable analyst Moffett wrote. “Cox is relatively late to the wireless game. But that only means that the opportunity in [the combined companies’] footprint is that much larger.”

The companies said they could wring about $500 million a year in annual cost savings.

The combined company would have about $111 billion of debt.

Cox would have two directors on the 13-member board, including Taylor, who would serve as chairman.

Advance/Newhouse would keep its two board members. Advance/Newhouse would hold about 10% of the new company’s shares.

The transaction is expected to close at the same time as Charter’s merger with Liberty Broadband, which was approved by Charter and John Malone’s Liberty Broadband stockholders in February.

After the consolidation, Liberty Broadband will no longer be a direct Charter shareholder.

The Associated Press contributed to this report.