Over The Rainbow

The Dolan family’s $36/share privatization bid last year didn’t go over well with many Cablevision shareholders, who seem similarly displeased by the MSO’s alleged plan to enhance its stock value through segment sales or acquisitions. After the NY Post reported strategic talks between CVC and Bear Stearns and a possible sale of the MSO’s Rainbow Media unit, Wall St sent CVC shares down 1.8% Mon to close at $27.41. CVC officials declined comment. With AMC, IFC and other assets, Rainbow has been valued by many at approx $3bln, although it could fetch more based on AMC’s recent success. Sanford Bernstein believes Cablevision should sell instead of buy and that the former option could help the Dolan’s fund yet another privatization play. “We believe asset sales, not asset acquisitions, are not only preferable, but also much more likely,” wrote analyst Craig Moffett. “Notwithstanding the unpredictability of the Dolans as fiduciaries… we view Cablevision as the most attractively valued name in our coverage universe.”