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Family Makes New Offer for Cablevision

October 09, 2006|From Newsday

The Dolan family is seeking to take Cablevision Systems Corp. private for the second time in two years, this time in an all-cash offer worth more than $7.9 billion, according to a letter obtained by Newsday.

Chairman Charles Dolan and his son, Chief Executive James Dolan, delivered a letter Sunday to the Cablevision board, offering to buy all the outstanding shares at $27 each.

The deal comes a year after Charles Dolan dropped plans to take the Bethpage, N.Y., company private after five months of negotiations.

That deal was complicated by splitting the offer into a cash buyout for the cable company and a public spinoff of the New York Knicks and Rangers, TV channels and Madison Square Garden, according to a source familiar with the offer.

To overcome that obstacle, the Dolans made the new offer an all-cash deal, hoping that simplifying the structure and raising the offer price would push the deal through, the source said.

The Dolans had offered $33.50 a share last year -- $21 for Cablevision and $12.50 for a stake in the cable networks company Rainbow Media Holdings.

But, since that deal, the company has issued a $10 dividend. Adjusted for that dividend, Sunday's $27 offer is 14.9% higher than last year's offer, the Dolans' letter says.

"We continue to feel that succeeding in this fiercely competitive environment requires a long-term, entrepreneurial management perspective that is not constrained by the public market's constant focus on short-term results," the Dolans wrote.

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