Pali Capital Inc. analyst Richard Greenfield penned in a Monday research note a list of the top 10 reasons that Cablevision Systems Corp. might buy Tribune Co.'s Newsday. Many of the items are tongue in cheek, but overall the list reflects Greenfield's thesis that controlling shareholders Charles and James Dolan will look to buy businesses rather than try again to take Cablevision private.
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The list includes criticizing the Yankees "in hopes of weakening the sports franchise so Cablevision could one day buy the YES Network at a lower valuation"; writing a lengthy told-you-so editorial to Cablevision shareholders who turned down their $36.26 privatization offer last year (the stock now trades below $22); and promoting tour dates for CEO Jim Dolan's band JD and the Straightshot.
Kidding aside, Greenfield wrote, "We increasingly believe a meaningful portion of CVC's free cash flow over the next couple of years appears to be headed for a series of noncore acquisitions." That could include buying companies such as Newsday or rolling up live entertainment outfits. Incidentally, Bear Stearns Cos. was among the banks thato helped the Dolan family with their unsuccessful efforts to take Cablevision private, and the bank was said to be helping the company examine options for some of its entertainment assets.
Tribune declined to comment on speculation that it would shop Newsday. - Chris Nolter
See story about Newsday sale from The New York Times
See Dealwatch: Cablevision Systems Corp.
See Dealwatch: Tribune
