Cablevision Systems Corp., the cable company controlled by the Dolan family, plans to acquire Bresnan Communications for $1.36 billion, according to news reports. Bresnan, which is majority owned by Providence Equity Partners, a private equity firm, has about 320,000 subscribers in Colorado, Wyoming, Utah and Montana,
the
Wall Street Journal
reported.
The deal marks a shift in strategy for Cablevision, the country’s fifth-largest cable operator, which has mainly focused on its home market in the New York metro area.
The
Financial Times
noted
that “Cablevision’s return to deal making could leave its investors uneasy.”
… “[T]he Dolan family have alarmed investors over the years with erratic decisions, including the founders’ decision to create a rival satellite pay TV service a few years ago, before abandoning the venture. The company also paid about $650 million in 2008 to buy
Newsday,
the Long Island tabloid newspaper…. It was later forced to write down much of that investment.”
The
FT
article noted that Cablevision “has been in the good graces of shareholders” after announcing its decision to spin off its Madison Square Garden entertainment and sports franchise division, but its stock price has fallen because of its interest in Bresnan. (Sources:
Wall Street Journal,
June 14, 2010;
Financial Times,
June 14, 2010.)
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