Home » Cablevision »Competition »Consumer News » Currently Reading:

Cablevision: An Attractive Takeover Target for Time Warner Cable, Says Barron’s

Phillip Dampier November 7, 2011 Cablevision, Competition, Consumer News No Comments

Cablevision Systems may be engaged in a long term effort to position itself for a sale, some New York investment firms have come to believe.  The most likely buyer?  Time Warner Cable.

The bulk of Cablevision’s assets are located in several boroughs of New York, Long Island, New Jersey and Connecticut.  Virtually all of their service areas, outside of the acquisition of Bresnan Cable in the mountain west, are adjacent to Time Warner, making an acquisition by the nation’s second largest cable operator a natural fit.

This isn’t the first time rumors of a Cablevision sale have been floated.  The Dolan family has run the cable operator for decades, with family patriarch Charles Dolan still controlling a sizable interest in the company.  Barron’s notes the senior Dolan is currently in his 80s.  Son James, current president and CEO of Cablevision, seems more interested in his leadership role at Madison Square Garden, spun-off from Cablevision last year.

“I think the Dolans have positioned the company for a sale,” Mark Boyar, who heads Boyar Asset Management, told Barron’s.

Boyar points to Cablevision’s ongoing efforts to minimize their involvement in side businesses, such as MSG and cable networks like AMC, spun away from Cablevision on June 30.

Buyers like transactions to be simple and straightforward, and Cablevision’s operations increasingly meet both standards.

On its own, Cablevision’s growth opportunities come mostly from rate increases, which subscribers routinely complain about.  The company already enjoys the highest penetration rate among major cable operators and the highest average monthly revenue per subscriber — $150 a month vs. $113 for Time Warner Cable.  With a depressed economy and fierce competition from Verizon FiOS, growing the business (and the stock price) has become increasingly difficult in a maturing industry unlikely to attract new subscribers.

Among the only prospects for subscriber growth on the horizon comes from satellite TV subscribers.  But that alone may not be enough to keep investors satisfied, much less excited.  A sale could bring shareholders a massive return on their investment, particularly if a bidding war breaks out between likely buyers Time Warner Cable and Comcast.  Shareholders ultimately own the company, and should the Dolan family lose their love affair with cable, Cablevision and their subscribers will likely find themselves on the auction block.

Search This Site:

Contributions:

Recent Comments:

  • EJ: Just remember each state is different, but as a general rule the company hiring the contractor is liable for said contractors work. It will be AT&...
  • joe: Here in West Michigan I had to call Spectrum (Charter) to get my download speed raised ... my latest test using an Ethernet cable directly to the mode...
  • joe: Here in West Michigan I had to call Spectrum (Charter) to get my download speed raised ... my latest test using an Ethernet cable directly to the mode...
  • Donald: How do we participate in this lawsuit? They blatantly told me I wasn't getting what they promised. They are legitimately ripping us off...still!...
  • BestTiffany: I have noticed you don't monetize your website, don't waste your traffic, you can earn additional bucks every month because you've got hi quality con...
  • Kate Momotuik: So, the good thing is someone still cares about customers privacy rights (http://bit.ly/2GaapCV), it's nice to hear. Thanks for sharing the informatio...
  • Marvosa: Just got a free upgrade to 10/100 two days ago here in Minnesota. Of course, I was never notified of the upgrade. I only found out the service was a...
  • Josh: Wow, I'm honestly shocked they're doing that. Good!...
  • Mike: Suddenlink did a sneaky price increase on my Internet service during the holidays from $57 to $63. I believe it does this because fewer people pay att...
  • gitafitrh: htm Spread Spectrum External links: Frequency Control of Non-2. 4 GHz Spread Spectrum R/C Radio Systems: 2. 4 GHz Spread Spectrum R/C Systems do not r...
  • EJ: Yep Criminals don't know how to jailbreak a phone. How dumb lol. I wonder how many board meetings it took for them to come up with that excuse. Hey Ve...
  • Josh: shakes head in astonishment Just wow. Yes, I'm so much more "free" by allowing rich people to do whatever the hell they want....

Your Account: