Cablevision Systems Corp. could be shopping its Rainbow Media Holdings LLC. Pali Research analyst Rich Greenfield wrote in his most recent report that a new book for the cable channel group, which includes AMC, WeTV, Sundance, IFC and others is already circulating.
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During a second-quarter conference call, CEO James Dolan said the company was actively exploring alternatives to tighten the gap between operating performance and stock, hinting at either a take-private or a sale. However, with current debt markets as they are, a take-private would be "unrealistic," Greenfield wrote.
Its not the first time the Dolans tried taking the company private. The most recent effort was in 2006, but it ended when shareholders voted against the offer.
Additionally, Rainbow has been shopped before -- often in conjunction with some of the take-private attempts. The most recent sell-off report came in February, when Cablevision reportedly hired Bear Stearns Cos., according to a New York Post story.
Meanwhile, Silicon Alley Insider speculated Friday that the price of Rainbow could mirror the $3.5 billion Landmark Communications Inc. got for its recent sale of The Weather Channel. The unit's second-quarter revenue increased by 14.6% over last year, to $239.7 million, similar to analyst's estimates of The Weather Channel's revenue back in January.
As for the possibility of the Dolans taking the whole company private, look no further than the their prior attempts. As history has indicated, they will most likely creep toward taking it private through buybacks, as Greenfield wrote in his report.
Of course all of the speculation seems a little premature, as the Dolans haven't had time to see results from Cablevision's $500 million acquisition of the Sundance Channel. The company just purchased the channel in May. - Maria Woehr
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