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Cablevision Systems Corporation(CVC) which spun off Madison Square Garden(MSG) earlier this year is back at it, announcing that it plans to spin off its Rainbow Media Holdings business in mid-2011.
Rainbow Holdings owns such popular cable channels as AMC, WE, IFC, and Sundance. Investors appeared enthused about the move, with the stock moving up 6.84% on the news. After attempting to take the company private on several occasion, and disastrous acquisitions such as electronics chain Nobody Beats The Wiz, and newspaper Newsday, the controlling Dolan family appears to have adopted a strategy of breaking up the company into easier-to-value parts that can each focus on a core competency. The spinoff is also an opportunity to take advantage of the surging popularity of AMC, fueled by its runaway hit, Mad Men.
Disclosure: The author has no position in any stock mentioned
Related articles
- Cablevision exploring spinoff Rainbow Media (seattletimes.nwsource.com)
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- Cablevision Spinoff: The End of the ‘Dolan Discount’? (blogs.wsj.com)
