Rainbow spinoff

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rang1995

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Cablevision Announces Structure for New Company As It Prepares for Spin Off
Thursday April 29, 5:08 pm ET
New Company, to be Named Rainbow Media Enterprises, Inc., Will Have Three Divisions: Rainbow DBS, Rainbow Programming and Rainbow Movies (Clearview Cinemas)


BETHPAGE, N.Y.--(BUSINESS WIRE)--April 29, 2004-- Cablevision Systems Corporation (NYSE:CVC - News) today announced a new structure for the company it plans to spin off later this year comprising Cablevision's satellite, national programming and movie theater businesses. The new company will operate under the name Rainbow Media Enterprises, Inc.
Rainbow Media Enterprises, Inc. will have three divisions, and will operate as a financially distinct company within Cablevision until the spin off is complete. The divisions are:

Rainbow DBS, which includes the VOOM satellite television service;
Rainbow Programming, which includes the national entertainment services AMC, WE: Women's Entertainment and IFC (The Independent Film Channel) as well as IFC Entertainment and IFC Productions; the 21 VOOM high definition channels; and Mag Rack, sportskool, World Picks and other video-on-demand services; and
The newly added Rainbow Movies, (the corporate name for the theater group that will continue to do business as Clearview Cinemas).
The company plans to file a Form 10 shortly with the Securities and Exchange Commission. The company anticipates completing the spin off after the SEC declares the Form 10 effective and once it has refinanced the existing Rainbow credit facilities. The company has received a favorable ruling from the IRS regarding the tax free status of the spin off.

Businesses remaining with Cablevision following the spin off will include its cable and telecommunications businesses; Lightpath; Madison Square Garden and its teams; Radio City Music Hall; and certain other businesses including: fuse, News 12, Metro Channels and Rainbow's interests in regional sports networks around the country. (A full list of the division of businesses is attached).

Cablevision Chairman Charles F. Dolan is expected to serve as chairman of Rainbow Media Enterprises, following the spin off. Thomas C. Dolan, who currently serves as a board member, executive vice president and chief information officer (CIO) of Cablevision, will serve as Rainbow Media Enterprises' chief executive officer. William J. Bell, who will continue to serve as vice chairman of Cablevision through the end of the year, will also serve, prior to the spin off, as Rainbow Media Enterprises' chief financial officer, while Rainbow Media Enterprises conducts a search for a permanent CFO. Josh Sapan will continue to lead Rainbow's national programming efforts as president and CEO of Rainbow Programming. Mickey Alpert will continue as COO of Rainbow DBS, and Morten Gotterup will continue as senior vice president and general manager of Clearview Cinemas.

Charles Dolan, along with Tom Dolan and Josh Sapan, are also expected to become members of the Rainbow Media Enterprises board of directors after the spin off.

Charles Dolan said: "We have made significant progress in the implementation of our plan to create two distinct companies for Cablevision shareholders, each with separate funding and management, defined business strategies and clear investment characteristics. We are taking another step forward today as this reorganization begins to put in place the structure essential for the continued growth and development of the Rainbow Media Enterprises businesses.

"We also have assembled an outstanding management team to continue building these businesses. Tom, as director and senior executive, has played a key role in Cablevision's success for many years. His proven track record as a manager and executive, together with his strong technical expertise, make him well suited to lead this new business. We are also fortunate that Josh Sapan, one of the industry's leading programmers, will continue to operate Rainbow Programming, and we are gratified as well that Josh has agreed to join the board of directors of Rainbow Media Enterprises. And, leading up to the spin off, Rainbow Media Enterprises will benefit as well from Bill Bell's leadership and substantial experience with the financial community."

Thomas Dolan, 51, has been a director of Cablevision since 1998 and has served as executive vice president of Cablevision since October 2001 and as chief information officer since 1994. In the latter capacity, he oversaw Cablevision's corporate information systems function, which is responsible for maintaining more than 150 existing systems and applications as well as meeting all new systems and applications needs throughout the company. Prior to the post of CIO, Thomas Dolan served as general manager at Cablevision's East End Long Island cable television system. Before joining Cablevision, he spent seven years as a large systems customer engineer with IBM.

Cablevision Systems Corporation is one of the nation's leading entertainment, media and telecommunications companies. In addition to its broadband, cable, satellite, Internet and telephone offerings, the company owns and operates Rainbow Media Holdings LLC and its networks; Madison Square Garden and its teams; and Clearview Cinemas. In addition, Cablevision operates New York's famed Radio City Music Hall. Additional information about Cablevision Systems Corporation is available on the Web at www.cablevision.com.

This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties, and that actual results or developments may differ materially from those in the forward-looking statements as a result of various factors, including financial community and rating agency perceptions of the company and its business, operations, financial condition and the industry in which it operates and the factors described in the company's filings with the Securities and Exchange Commission, including the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" contained therein. The company disclaims any obligation to update the forward-looking statements contained herein.
 
D

DIGITAL~DAN

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Wow what a day this has been first the addition of the espn's and now this. I think this is the news we have been waiting on!!!!!!!!!!!!!Maybe now Marc cuban will negeotate and we will see hdnet in the near future...............great find rang!!!!!!!!!!!!!!!!!!!!!!DIGITAL~DAN
 
squicken

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Good find, rang. But I am less than impressed with Rainbow's channels. Fuse, IFC, WE, and the 21 Voom originals are junk. AMCs only good in that somehow they have exclusive rights to "Shane" :cool:
 
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rang1995

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The newly added Rainbow Movies"---wonder if they can branch out and shoot HDTV movies? there are some digital theaters out there..just a thought..who knows what this baby will look like in 3-5 years
 
R

rang1995

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cyuhnke said:
Good find, rang. But I am less than impressed with Rainbow's channels. Fuse, IFC, WE, and the 21 Voom originals are junk. AMCs only good in that somehow they have exclusive rights to "Shane" :cool:
Remember Rainbow had sportschannel(now fox sports net) bravo and others..what will new financing bring ??and what partners??MSFT? GE? NObody? this remains to be seen
 
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Sean Mota

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cyuhnke said:
Good find, rang. But I am less than impressed with Rainbow's channels. Fuse, IFC, WE, and the 21 Voom originals are junk. AMCs only good in that somehow they have exclusive rights to "Shane" :cool:


IFC, WE & AMC are or will be a source of revenue since every cable/satellite service carries them. The 21 exclusive channels will one day fall into the same category once VOOM has a good sub based and they can make the 21 channels better by adding more content. VOOM is not only a DBS service but also a programmer (which brings revenue).
 
R

rang1995

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an old article, but you will have to wait to see how things develop, a secondary? who the Underwritters are? how much$$ this can give VOOM plenty of operating money

Thursday, March 4, 1999
Home Edition
Section: Business

Laggard Companies Trying Spinoffs to Unleash Stock Value


Securities: Hewlett-Packard joins growing list of firms breaking off units. Some freed entities have been hot stocks.
By: JOSH FRIEDMAN
TIMES STAFF WRITER

Companies such as Hewlett-Packard that feel underappreciated by the stock market are increasingly turning to divisional spinoffs to create value, and the trend can be a boon for investors--if they choose carefully.

Long-term studies have shown that spinoff stocks "clobber" the overall market in their first years, according to one specialist who tracks this niche.

But more recent deals have included many disappointments, at least so far.

Data from Spin-Off Advisors in Chicago show that of 63 spinoffs that began trading between January 1996 and June 1998, only 29 had gained in price through Dec. 31 of last year. And only 19 beat the blue-chip Standard & Poor's 500 index from their spinoff dates through Dec. 31.

But winners such as Lucent Technologies, up sevenfold since its 1996 spinoff from AT&T, and Cognizant Technology Solutions, which has more than tripled since being spun off from IMS Health last June, show that business spinoffs can present lucrative opportunities.

Long-term, "these deals tend to be good for both the parent company and the new spinoff company," said Joseph Cornell, president of Spin-Off Advisors. "For the parent, it's a good way to shake up the business and concentrate on what you do best. And the managers of the new company are highly incentive-ized by stock options, and their egos are on the line."

Hewlett-Packard, suffering from disappointing earnings growth in recent years, on Tuesday said it will spin off its medical-products and measuring-devices businesses to focus on its core computer businesses.

Cornell noted that a Penn State University study of 174 spinoffs from 1965 through 1994 found that the new firms' stocks rose 76%, on average, in their first three years, outperforming the S&P's gain by about 31 percentage points.

The researchers found that parent companies also outperformed the broad market, though to a lesser degree. Studies by J.P. Morgan & Co. have found similar results.

Spinoffs have risen in number and dollar volume each of the last five years, Cornell said.

While every case is different, spinoffs come in two basic forms: "pure" spinoffs, in which a company breaks off a business in one shot, usually via new shares distributed to shareholders; and the increasingly popular two-step "carve-outs," in which a company sells a 15% to 20% chunk of a division to the public through a stock offering, then distributes the remaining shares to its shareholders six to eight months later.

Cornell said pure spinoffs often stumble at first--which would explain the weak performance of many recent deals.

Shares of PepsiCo's fast-food spinoff, Tricon Global Restaurants, for instance, fell about 10% in the firm's first few months before management turned things around. The company was initially burdened by a heavy debt load, a price parent firms often levy in exchange for a spinoff's freedom. But the Pizza Hut-KFC-Taco Bell chain quickly re-energized its business and the shares have zoomed 111% in the last year.

"Pure spinoffs often take six months or even two to three years to kick it into gear," Cornell said. From Wall Street's point of view, "they can fall through the cracks. It's not like an initial public offering--they don't have roadshows and analysts talking up the story."

Indeed, the Penn State researchers found that spinoffs under-perform the overall market by about 1 percentage point, on average, in their first six months, before finding their footing.

For patient investors, that can spell opportunity. "Early on--that's the time for bargain hunting," Cornell said.

Carve-outs, meanwhile, tend to fare better off the bat because their parent has a vested interest in seeing the shares do well. "The big success stories like Lucent have really legitimized this technique in recent years," Cornell said.

Last year's equity carve-out volume of $11.5 billion in 14 deals shattered the previous record. In fact, the year's three biggest initial public stock offerings by dollar volume were carve-outs: Conoco, from DuPont; Infinity, from CBS; and Fox, from News Corp.

Recent deals in the same mold include General Motors' carve-out of Delphi Automotive, and now, Hewlett-Packard's plan.

"Doing the IPO lets the parent company raise capital and get a bigger bang for the buck," said Barbara Goodstein, spinoff analyst at Rothschild Inc. in New York. "And they can usually get a nice, high valuation" as analysts compare the new company with others in the same business, she said.

A recent Harvard University study found that a key to the success of many spinoffs is the additional coverage the new companies get from analysts attracted to the more focused business.

And the purest plays among spinoffs often become takeover bait, which Cornell said may be key to the stocks' overall strong performance, despite many losers.

Fending for Themselves

Business units spun off from their parent companies to fend for themselves can be big winners in the stock market, recent deals show. But the spinoff roster also includes many bombs. A sampling of spinoff deals since 1995: Spinoff Winners. . . .


Stock
gain
to
Spinoff Date date

Lucent 4/4/96 571%
Earthgrains 3/26/96 201%
Dial 8/16/96 123%
Midas 1/30/98 105%
Tricon Global 10/7/97 100%


. . .and Losers loss
to
Spinoff Date date

Octel 5/26/98 -40%
Vlasic Foods 3/30/98 -54%
Unisource 1/2/97 -59%
Tupperware 5/31/96 -62%
TCI Satellite 12/5/96 -94%
 
squicken

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Tell me you know anyone who regularly watches any of these channels. I'm not disputing the product model, I think it's a good idea. I am saying the execution so far has been uninspiring. Hopefully new partners will emerge. I'd love it if Cinema 10 got some better movies, for instance. Can't say I look forward to the commercials being added, though.
 
vurbano

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Big mistake spinning it off this soon. Wait till youve implemented WM9 and filled out your offerings and signed the contracts. No more deep pockets to solve problems. I dont think you will see hdnet. Cuban will want them to take hdnetmovies and we have 10 channels of that. we have the concerts on rave, we have some of the extreme sports on rush etc. INHD is a much more realistic addition and being under cablevision improves the chances of getting it. But when voom is a seperate company, well im afraid if that happens before inhd then there will never be any inhd. there certainly wont be any hdnet.
 
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rang1995

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not till the fall---
"The new company will operate under the name Rainbow Media Enterprises, Inc.
Rainbow Media Enterprises, Inc. will have three divisions, and will operate as a financially distinct company within Cablevision until the spin off is complete. The divisions are:
 
S

Sean Mota

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Rainbow DBS, which includes the VOOM satellite television service;
Rainbow Programming, which includes the national entertainment services AMC, WE: Women's Entertainment and IFC (The Independent Film Channel) as well as IFC Entertainment and IFC Productions; the 21 VOOM high definition channels; and Mag Rack, sportskool, World Picks and other video-on-demand services; and
The newly added Rainbow Movies, (the corporate name for the theater group that will continue to do business as Clearview Cinemas).

In my opinion, Charles Dolan is getting the best out of the spin off. Look at all the access that he will get. Given all the VIDEO on DEMAND access that will be spin off with VOOM I will not be surprised if VOOM finds a way to provide VIDEO on DEMAND through satellite. This is a good move and I think VOOM got the upper hand here.

Rainbow DBS will include:

1- AMC
2- WE
3- IFC
4- IFC Entertaiment
5- IFC productions
6- 21 VOOM HD channels
7- Mag Rack
8- Sportskool
9-World Picks
10- Other Video on-deamand services
11- Clearview Cinemas

Here is a link for Sportskool:

http://www.sportskool.com/nb/get-sportskool.jsp

Here is a link for Mag Rack (Video On Demand):

http://www.magrack.com/index.jsp

This whole page summarizes all the VIDEO on DEMAND:

http://www.rainbow-media.com/ondemand/

Clearview Cinemas:

http://www.clearviewcinemas.com/
 
R

rang1995

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another article on this
(This article was originally published Thursday)


NEW YORK (Dow Jones)--Cablevision Systems Corp. (CVC), which plans to file
spinoff papers for its nascent satellite TV service "shortly," gave details of
the new company's structure Thursday.

This is the third time Cablevision has tinkered with the spinoff company's
structure.

The entity to be spun off, which will be called Rainbow Media Enterprises,
will include Voom, Cablevision's satellite TV business, plus programming assets
AMC, Women's Entertainment, The Independent Film Channel, IFC Entertainment,
IFC Productions, Mag Rack, World Picks and sportskool.

The company will also include Clearview Cinemas, which was part of the
original spinoff plan but was taken out of the second plan.

Adding Clearview Cinemas back into the spinoff will help bulk up assets and
create more cash flow, noted Tom Eagan, analyst at Oppenheimer & Co. The
company has altered its spinoff plan in the past in order to finance
higher-than-expected costs.

Pressured by heavy debt and investor displeasure, Cablevision first said it
would spin off Voom in June 2003. The spinoff was designed to limit the amount
of capital Cablevision would invest in the venture.

The company unveiled altered spinoff plans in October which removed Clearview
Cinemas from the spinoff but added three of its prized cable networks: AMC, IFC
and WE. Structured in this way, the new business would be self-funding,
executives said.

As previously announced, Cablevision Chairman Charles Dolan will serve as
chairman of Rainbow Media after the spinoff. He has appointed his son, James
Dolan, to take over the Cablevision chairman title.

Cablevision also disclosed additional executive appointments. Thomas Dolan,
who is currently a board member and chief information officer at Cablevision,
will serve as Rainbow's chief executive. William Bell, who is vice chairman of
Cablevision through the end of the year, will act as a temporary chief
financial officer, while Mickey Albert will be Rainbow's chief operating
officer.

Dolan, Bell and Josh Sapan, who will continue to act as chief executive of
Rainbow Programming, will become members of Rainbow's board of directors after
the spinoff.

Despite Wall Street's disapproval, Cablevision has continued to pursue the
satellite TV business. Analysts have argued that its niche market - high
definition TV aficionados - is not big enough. They have also said that the
company's late entry puts it at a serious disadvantage.

DirecTV Group Inc. (DTV), the country's largest satellite TV provider, and
follow-up EchoStar Communications Corp. (DISH), have about 21 million
subscribers combined nationwide. By contrast, Cablevision, which launched its
service just late last year, signed on 1,627 customers as of March 1.

In preparation for the spinoff, Cablevision has also announced changes to its
management structure. The company said Monday that it appointed Tom Rutledge,
president of cable & communications, to a newly created chief operating officer
post.

Executives had said the spinoff papers would be filed in the second quarter
 
compurocker

compurocker

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Mar 25, 2004
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Whether anyone actually watches those channels or not doesn't really matter as long as cable/satellite services across the country still continue to carry them. They will be an already established recurring source of revenue for Rainbow as they try to build VOOM's own subscriber base.

I do have to say I love Fuse except for one thing... William Hung. *shudders*
 
mike123abc

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If VOOM was smart with their DVR box they would put a second disk in it for VOD. They could download via a slow stream tons of stuff to that drive. With windows media they could put many hours of VOD in HD on the second disk.
 
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Sean Mota

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mike123abc said:
If VOOM was smart with their DVR box they would put a second disk in it for VOD. They could download via a slow stream tons of stuff to that drive. With windows media they could put many hours of VOD in HD on the second disk.

Mike,

that's an excellent idea. I wonder if the VOD stuff would also translate to HD. Imagine that!
 
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Ken F

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As a satellite provider, VOOM doesn't have capacity for true VOD. They could do some sort of psuedo-VOD, like DirecTV does for Starz.
 
T

txdude

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Given that voOm is licensing WM9 and they plan on having DVRs that are networked... They could offer on demand HD WM9 movies over the internet for those subscribers with broadband connections. The DVRs could have the on demand feature integrated and subscribers could select from a library of movies for a specific fee. A few minutes download time to see a HD movie of my choice would definitely be worth it and it would allow me to take full advantage of my 3 Mbps cable connection :D
 
M

marty2112

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Sean Mota said:
In my opinion, Charles Dolan is getting the best out of the spin off. Look at all the access that he will get. Given all the VIDEO on DEMAND access that will be spin off with VOOM I will not be surprised if VOOM finds a way to provide VIDEO on DEMAND through satellite. This is a good move and I think VOOM got the upper hand here.

Rainbow DBS will include:

1- AMC
2- WE
3- IFC
4- IFC Entertaiment
5- IFC productions
6- 21 VOOM HD channels
7- Mag Rack
8- Sportskool
9-World Picks
10- Other Video on-deamand services
11- Clearview Cinemas

Here is a link for Sportskool:

http://www.sportskool.com/nb/get-sportskool.jsp

Here is a link for Mag Rack (Video On Demand):

http://www.magrack.com/index.jsp

This whole page summarizes all the VIDEO on DEMAND:

http://www.rainbow-media.com/ondemand/

Clearview Cinemas:

http://www.clearviewcinemas.com/
Your forgetting an important piece of the spin off... Rainbow Network Communications.
Its where I work as the Manager of the Technical Operations Center and is where we do the VOOM encryption and uplink! As well as all other transmission of Rainbow Programming (including Fox Sports). A VERY important piece!!!!
 
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rang1995

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"Your forgetting an important piece of the spin off... Rainbow Network Communications.
Its where I work as the Manager of the Technical Operations Center and is where we do the VOOM encryption and uplink! As well as all other transmission of Rainbow Programming (including Fox Sports). A VERY important piece!!!!"

Marty: Nice to have you here. How much of the fox sports net does rainbow still uplink? i know they started with sportschannels and some others but there were a few they didnt have a piece of(sunshine?) etc.thanks
 
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Sean Mota

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marty2112 said:
Your forgetting an important piece of the spin off... Rainbow Network Communications.
Its where I work as the Manager of the Technical Operations Center and is where we do the VOOM encryption and uplink! As well as all other transmission of Rainbow Programming (including Fox Sports). A VERY important piece!!!!

This is even better Marty. Thanks for letting us know about it. This is excellent!
 

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