The Dolans & The Cablevision Pie Cutter (CVC)

Today feels like another episode of deja-vu in failed mergers, although perhaps this is just a similar situation rather than a total repeat.  Cablevision Systems Corp. (NYSE: CVC) has announced that its board of directors has authorized the management to explore several strategies to enhance shareholder value.  The company will also hire investment banking firms to explore such a strategy.

The company is free to evaluate and establish a policy with respect toquarterly dividends or stock buybacks; and separately it can explorethe spin-off of one or more businesses and other potential strategies.  As far as which units or which operations may be up for grabs, yourguess is as good as any. Here are some of its listed operations:

• Cablevision cable TV serves more than 3 million households in the New York metropolitan area;
• Advanced telecommunications and triple-play offerings for digitaltelevision, high-speed Internet,digital voice, and integrated businesscommunications services;
• Several programming businesses including AMC, IFC, Sundance Channel and WE tv, through Rainbow Media Holdings LLC;
• Newsday in the New York area as publisher of newspaper and other niche publications;
• Madison Square Garden and sports teams New York Knicks, Rangers and Liberty;
• New York’s Radio City Music Hall, the Beacon Theatre, and the Chicago Theatre;
• Clearview Cinemas.

If you will recall, the Dolans tried and tried to take this private ina sage that seemed was a never-ending story which ultimately failed.Mario Gabelli was one of the key opposition parties to the merger whichwas raised to over $36.00 per share.  Before today’s gains this stockhad lost roughly one-third of its value.  Shares even briefly tradedunder $20.00 just last month.

Since Mario Gabelli just filed for a $200 million blank check IPO andhas a second blank check in conjunction with it, perhaps the Dolan’sshould call Mario Gabelli first and see if he has any interest inenhancing the value he helped in blocking the first time around.

Shares are up over 6% today at $27.55 on hopes that the company will find more value in the parts rather than as a whole.

Jon C. Ogg
August 5, 2008