Another new SEC filing (CVC 8-k): Closing of Rainbow DBS business has been delayed!

[riffjim4069]

"The shareholders should not be burdened with voom's enormous debt "

Isn't C Dolan trying to assume the assets AND liabilities????? If CVC shuts it down, they're stuck with the debt themselves! Duh!

Would you assume only 200M million in assets and 6000M in debts out of the goodness of your heart? I certainly wouldn't! Whether or not Dolan Sr. gains control of VOOM, CVC is going to be stuck with much of the debt in one form or fashion...just how much is the question.

 

[Juan]

"The shareholders should not be burdened with voom's enormous debt "

Isn't C Dolan trying to assume the assets AND liabilities????? If CVC shuts it down, they're stuck with the debt themselves! Duh!

maybe thats the deal wasnt able to be concluded cvc wants chuck to take the debt

 

[danielle_s]

OFF TOPIC... Danielle, was it you who said you were getting voom installed today? If it was, how did it go? Thanks

No my install date is set for March 31st, it was vicki who was getting installed today?

Why?

 

[Juan]

Juan, do you have the particulars of what the shutdown costs vs. a sale to Dolan Sr.? I would like to see the dollars and cents comparison. I'm assuming you have that information to make the statement that you just did.

Obviously its better to shut down at this time because the only thing most corporate boards are interested is money

 

[danielle_s]

cablevision shouldn't be forced to throw the debt on mr. dolan. They are responsible for being in debt and they deserve to be there

 

[Go Bears]

John Doe buys a painting for $100K that he thinks will be worth a lot more in a couple of years. Instead, it turns out after a couple of years that the painting is worth a lot less, only $50K and might be worth a lot less than that (maybe even $0) if John Doe does not sell it now.

Should John Doe (1) accept that the fact that he made a losing investment and recoup $50K of it, so that his loss is $50K, understanding that there is always a possiblity that the painting might be worth a lot more if he holds onto it for 5, 10, 15 years but that it more likely could be worth nothing, or (2) curse his bad luck and set fire to the painting, thereby making certain that he loses $100K right now?

Although admittedly a crude analogy, it seems that if CVC does not sell its remaining VOOM assets to VOOM HD LLC and instead immediately shuts down VOOM, it is choosing course of action number (2).

 

[truqui]

John Doe buys a painting for $100K that he thinks will be worth a lot more in a couple of years. Instead, it turns out after a couple of years that the painting is worth a lot less, only $50K and might be worth a lot less than that (maybe even $0) if John Doe does not sell it now.

Should John Doe (1) accept that the fact that he made a losing investment and recoup $50K of it, so that his loss is $50K, understanding that there is always a possiblity that the painting might be worth a lot more if he holds onto it for 5, 10, 15 years but that it more likely could be worth nothing, or (2) curse his bad luck and set fire to the painting, thereby making certain that he loses $100K right now?

Although admittedly a crude analogy, it seems that if CVC does not sell its remaining VOOM assets to VOOM HD LLC and instead immediately shuts down VOOM, it is choosing course of action number (2).

The problem with this analogy is that you can't make any improvements that add value to the painting. In the case of a venture like Voom, product, distribution, marketing, etc help add subs which in turn grows the value of the co. Unfortunatley they haven't done any of these things to light the fire and lift off...be it CVC or Voom. Hopefully if Dolan Sr. gets to do it again he will see to it that all of tiers needed to succeed are in place!

 

[graphiteRT]

Obviously its better to shut down at this time because the only thing most corporate boards are interested is money

If you shut it down, you get nothing for it. Plus you're on the hook for the shutdown costs, satellite contract cancelations, etc. If you sell it, at least you get something.

So how does that put more money in the CVC coffers?

 

[Lobstah]

"The SEC is steping in because of what has gone wrong with VOOM. They want to know why VOOM has "failed" and who was behind it."

Sorry...this is actually kinda funny...

Make no mistake. The SEC could care less about 'what has gone wrong with VOOM' and 'why it failed'...
The SEC has a mandate to ensure that laws are upheld and that shareholders are not defrauded of value. Beyond laws being broken, they could give a rat's backside about why any company fails.

And this one from Juan:
"the only thing most corporate boards are interested is money"
It damned well better be. It's their #1 job. It is the ONLY reason to be in business, period. Make money. If your goal is anything other than that, you have no need to BE in business.

Lob

 

[alandail]

if CVC shuts down voom instead of selling it off, aren't they left with all of that debt? So selling the company off gets them something back for their investment vs. getting nothing back.

 

[Westbender]

Well, even if CVC can offload a portion of the debt onto Voom LLC, it would still be better than assuming all of the debt plus the shutdown costs.

 

[Westbender]

beat me to it...

 

[danielle_s]

Ok so the SEC is to make sure that the shareholders weren't defrauded. Ok, but how would they know unless they figure out what CVC did or didn't do to defraud our share value?

 

[danielle_s]

I'm out of this topic

 

[rocatman]

cablevision shouldn't be forced to throw the debt on mr. dolan. They are responsible for being in debt and they deserve to be there

The problem is that Mr. Dolan (Charles) as an officer of Cablevision and arguably the strongest advocate of Voom on the Cablevision board, is also responsible for the Voom debt. In his position, he has a responsibility to the Cablevision shareholders and that responsibility is legally greater than any responsibility he has to Voom subscribers.

 

[mdonnelly]

You really hate VOOM and anybody that subscribed that much?

I don't hate anybody here, even YOU (or Sean, or Bradley, or Vicki, or the other cheerleaders). I do hate corporations and their officers that manipulate the corporate assets to the detriment of the shareholders, who expect honest effort from the company to make a return on their investment.

VOOM is not viable for CVC, can we all agree on that? Wall Street knows. That's why the CVC shares jump in value when VOOM's divestiture is announced, and drop in value when the divestiture is delayed. Should CVC dump it? Yes, but how?

1. Shut the doors and fire everyone now, to stop hemorraging dollars ASAP?
2. Give the assets that remain to the Chairman's privately owned company and keep the liabilities, hoping that the SEC won't notice (Don't tell me it's a sale, that dog won't hunt).
3. Open a bidding process to responsible parties (E*, D*, other cable entities)?

Obviously there are other options besides mine. That's why we have discussion forums, to air opinions. I'm not here to blindly cheer on VOOM just because I have a HD television set. VOOM is not my religion.

 

[Westbender]

I believe the letter of intent by Voom LLC was to assume the assets AND liabilities. Why wouldn't CVC jump at that opportunity?

 

[graphiteRT]

I don't hate anybody here, even YOU (or Sean, or Bradley, or Vicki, or the other cheerleaders). I do hate corporations and their officers that manipulate the corporate assets to the detriment of the shareholders, who expect honest effort from the company to make a return on their investment.

VOOM is not viable for CVC, can we all agree on that? Wall Street knows. That's why the CVC shares jump in value when VOOM's divestiture is announced, and drop in value when the divestiture is delayed. Should CVC dump it? Yes, but how?

1. Shut the doors and fire everyone now, to stop hemorraging dollars ASAP?
2. Give the assets that remain to the Chairman's privately owned company and keep the liabilities, hoping that the SEC won't notice (Don't tell me it's a sale, that dog won't hunt).
3. Open a bidding process to responsible parties (E*, D*, other cable entities)?

Obviously there are other options besides mine. That's why we have discussion forums, to air opinions. I'm not here to blindly cheer on VOOM just because I have a HD television set. VOOM is not my religion.

Man, you are reaching.

Do you honestly think the SEC would allow CVC to "GIVE" the assets to Dolan Sr.

ROFL!

Dog won't hunt because he doesn't have a clue he's a dog!

 

[Lobstah]

And another way of looking at this:
"Unfortunatley they haven't done any of these things to light the fire and lift off...be it CVC or Voom. Hopefully if Dolan Sr. gets to do it again he will see to it that all of tiers needed to succeed are in place!"

Actually, based on the numbers, I think they did quite a bit to light the fire and lift off. They almost doubled their sub number in 2mos.

Maybe that's exactly the problem. Think about what happens when someone signs up for VOOM right now.

They get a free install of 3 rooms. What's the total cost for 3 boxes, plus shipping, plus an OTA antenaa, plus paying the installer to come out and do the install. Lets say for the sake of argument that this is a $2000.00 cost to CABLEVISION (<---major point )

They also get 2 mos of VaVa for free, so that makes the payback period even longer.

So you're CABLEVISION, and you see subscriber numbers going through the roof. You anticipate that you're going to have 30,000 more people sign up in the next month, while the lawyers are screwing around with this deal. This is costing you a LOT of money, every time the phone rings, because you're selling this business unit.
Dolan Sr. sort of has you over a barrell here, because he can say "Hey...I'm not taking all that debt...that's YOUR problem", and what's your alternative? To not sell to him, and then eat the WHOLE enchilada. Dolan Sr. is absolutely in the driver's seat here, because there aren't any other buyers in town, at least that we're aware of.

And if you're him, why pay more? You have 46,000 people sitting out there with boxes already delivered to their houses, along with dishes, antennas...the whole 9 yards. Let it all go dark, don't pay ANYTHING to CVC, and then start a new company next month that uses the existing hardware that is of no use to anyone else anyway

You've gotta luv Chuck.

Lob

 

[mike123abc]

You have to look at this from a dollars and cents point of view... What has been stated by CVC:

1. It will cost CVC $355 million dollars to shut down VOOM. (Actual cash and write off of the assets that are now valueless)

2. Dolan has offered to assume the liabilities of VOOM (maybe some, all, no one outside the boardroom really knows)

3. The board voted it would be better for the shareholders to shutdown VOOM.

Just because he offers to take over VOOM does not mean that CVC is off the hook. CVC is the one that signed all the agreements for the construction of satellites, leasing of space, etc. If Dolan takes over VOOM and fails to make it work, a few years down the line CVC mighet end up on the hook for even more money than it is now (i.e. a couple satellites get built and have not been paid for).

Dolan obviously feels he provided enough guarantees to prevent this from happening and now appears to be fixing up the board to see his point of view. But, even if you are Dolan's best buddy you probably would not want to risk going to jail and paying huge fines to help him make a quick buck. The final deal is going to have to pass muster. Perhaps the previous deal was really close or would be considered by some to pass, and now it will go through with a resonable defense.