Cablevision May Split Company

Cablevision’s majority shareholders, the Dolan family, are looking to take the cable TV provider private and spin off its entertainment assets – including Madison Square Garden Arena and Radio City Music Hall – into a separate, publicly traded company.

Under the $7.9 billion proposal issued to Cablevision’s board June 19th by chairman Charles Dolan and his son, CEO James Dolan, the new company would be called Rainbow Media Holdings and would also include the New York Rangers and Knicks, and a number of cable channels.

Shareholders would receive $21 cash for each Cablevision share plus stock estimated at $12.50 per share in the new company.

James Dolan would become chairman/CEO of Rainbow, while the private Cablevision would be run by Charles Dolan as chairman and current COO Thomas Rutledge as CEO.

The Dolans and other cable companies have said cable shares have become undervalued in recent years. Taking Cablevision private would “better enable the cable company to meet its competitive challenges,” the Dolans said in their proposal.

The announcement comes less than two weeks after Cablevision and its allies succeeded in defeating plans for a new West Side stadium that would have competed with Madison Square Garden.