Cablevision's Dolan Ousts Three From Board Over Voom Shut Down
March 3 (Bloomberg) -- Cablevision Systems Corp. Chairman Charles Dolan ousted three directors after a dispute with the board over the closure of the Voom satellite-television service, founded by Dolan two years ago.
Dolan, who owns a majority of Cablevision's Class B shares, yesterday installed executives including Liberty Media Corp. Chairman John Malone and former Viacom Inc. Chief Executive Frank Biondi. Quadrangle Group managing principal Steven Rattner is among the departing directors, Dolan said in a statement issued at 8:09 p.m. New York time.
The boardroom coup at Cablevision, the largest cable- television operator in New York, escalates a disagreement between Dolan and his son, Cablevision Chief Executive Officer James Dolan, over the Bethpage, New York-based company's decision to close money-losing Voom and sell its satellite. Charles Dolan, 78, and another son, Thomas, offered to buy the rest of the unit before Cablevision ended talks this week.
``Mr. Dolan is hoping new blood on the board will allow him to buy Voom from Cablevision rather than have it shut down,'' said New York-based Fulcrum Global Partners LLC analyst Richard Greenfield, who rates Cablevision shares ``buy.''
Dolan said a majority of Class B shareholders, all family members or partnerships or trusts for the family, voted to add Malone, Biondi, former ITT Corp. Chairman Rand Araskog and former Citizens Communication Co. Chairman Leonard Tow.
They will replace Rattner, the late John Tatta, and recently retired Cablevision officers William Bell and Sheila Mahoney, Dolan said.
The new members of the board may be more receptive to Dolan's argument that Cablevision stands to gain more from selling the unit's remaining assets than shutting it down, Greenfield said.
Voom
Voom drained $1.4 billion from Cablevision, according to Merrill Lynch & Co. analyst Jessica Reif Cohen. The company last month posted a fourth-quarter loss because of $354.9 million in costs related to the Rainbow DBS unit, of which Voom was a part.
Dolan championed the satellite business, which attracted 26,000 subscribers, as an alternative to DirecTV Group Inc., the biggest satellite-TV company with 13.9 million customers, and No. 2 EchoStar Communications Corp.'s Dish service
Dolan and Thomas Dolan created Voom HD LLC to purchase Voom after Cablevision sold the service's main orbiter to EchoStar.
Cablevision spokesman Charlie Schueler yesterday declined to comment. Edward Horowitz, a spokesman for Dolan, didn't immediately return a call seeking comment.
Cablevision's board will be asked at a March 7 meeting to increase its size so the company's Class B shareholders can elect Brian Sweeney to fill a new seat, Dolan said in the statement. Sweeney is a vice president at Cablevision and Dolan's son-in- law.
The four new board members will hold their seats until the company's May 19 annual meeting and then be re-nominated, Dolan said yesterday.
Malone
In bringing Malone, 63, to the board, Dolan gains a director who ran cable-TV provider Tele-Communications Inc. for more than 25 years. Malone kept control of Liberty Media, TCI's cable- programming arm, after selling TCI to AT&T Corp. in 1999. TCI at the time was Cablevision's largest common shareholder, and AT&T got that stock in the TCI purchase.
Since then, Malone has built Liberty into a media company that includes the QVC shopping network, the Starz group of movie cable networks and a 50 percent stake in Discovery Communications, owner of the Discovery Channel.
Malone last year acquired an 18 percent voting stake in Rupert Murdoch's News Corp. Murdoch said Feb. 2 that an agreement to reduce Malone's stake in the company may be reached in nine months.
Biondi
Biondi was Viacom's CEO from 1987 until 1996, when Chairman Sumner Redstone ousted him, saying Biondi lacked the fast-paced and aggressive management style needed to run Viacom. Biondi, 60, became chairman and CEO of Universal Studios Inc. and since 1999 has been a senior managing director at Waterview Advisers LLC.
Tow until 2004 worked at Stamford, Connecticut-based Citizens Communications Corp., a telecommunications company, and its predecessors. Araskog sits on the board of ITT, International Steel Group Inc. and Rayonier Inc., a forestry products company.
Cablevision shares fell 13 cents today in New York Stock Exchange composite trading. They've risen 19 percent in the last 12 months.
Araskog declined to comment. Rattner didn't immediately return a call and e-mail seeking comment after business hours. Liberty spokesman Mike Erickson didn't immediately return a call seeking comment. Biondi didn't immediately return a call to his office after business hours.
Last Updated: March 3, 2005 02:51 EST
March 3 (Bloomberg) -- Cablevision Systems Corp. Chairman Charles Dolan ousted three directors after a dispute with the board over the closure of the Voom satellite-television service, founded by Dolan two years ago.
Dolan, who owns a majority of Cablevision's Class B shares, yesterday installed executives including Liberty Media Corp. Chairman John Malone and former Viacom Inc. Chief Executive Frank Biondi. Quadrangle Group managing principal Steven Rattner is among the departing directors, Dolan said in a statement issued at 8:09 p.m. New York time.
The boardroom coup at Cablevision, the largest cable- television operator in New York, escalates a disagreement between Dolan and his son, Cablevision Chief Executive Officer James Dolan, over the Bethpage, New York-based company's decision to close money-losing Voom and sell its satellite. Charles Dolan, 78, and another son, Thomas, offered to buy the rest of the unit before Cablevision ended talks this week.
``Mr. Dolan is hoping new blood on the board will allow him to buy Voom from Cablevision rather than have it shut down,'' said New York-based Fulcrum Global Partners LLC analyst Richard Greenfield, who rates Cablevision shares ``buy.''
Dolan said a majority of Class B shareholders, all family members or partnerships or trusts for the family, voted to add Malone, Biondi, former ITT Corp. Chairman Rand Araskog and former Citizens Communication Co. Chairman Leonard Tow.
They will replace Rattner, the late John Tatta, and recently retired Cablevision officers William Bell and Sheila Mahoney, Dolan said.
The new members of the board may be more receptive to Dolan's argument that Cablevision stands to gain more from selling the unit's remaining assets than shutting it down, Greenfield said.
Voom
Voom drained $1.4 billion from Cablevision, according to Merrill Lynch & Co. analyst Jessica Reif Cohen. The company last month posted a fourth-quarter loss because of $354.9 million in costs related to the Rainbow DBS unit, of which Voom was a part.
Dolan championed the satellite business, which attracted 26,000 subscribers, as an alternative to DirecTV Group Inc., the biggest satellite-TV company with 13.9 million customers, and No. 2 EchoStar Communications Corp.'s Dish service
Dolan and Thomas Dolan created Voom HD LLC to purchase Voom after Cablevision sold the service's main orbiter to EchoStar.
Cablevision spokesman Charlie Schueler yesterday declined to comment. Edward Horowitz, a spokesman for Dolan, didn't immediately return a call seeking comment.
Cablevision's board will be asked at a March 7 meeting to increase its size so the company's Class B shareholders can elect Brian Sweeney to fill a new seat, Dolan said in the statement. Sweeney is a vice president at Cablevision and Dolan's son-in- law.
The four new board members will hold their seats until the company's May 19 annual meeting and then be re-nominated, Dolan said yesterday.
Malone
In bringing Malone, 63, to the board, Dolan gains a director who ran cable-TV provider Tele-Communications Inc. for more than 25 years. Malone kept control of Liberty Media, TCI's cable- programming arm, after selling TCI to AT&T Corp. in 1999. TCI at the time was Cablevision's largest common shareholder, and AT&T got that stock in the TCI purchase.
Since then, Malone has built Liberty into a media company that includes the QVC shopping network, the Starz group of movie cable networks and a 50 percent stake in Discovery Communications, owner of the Discovery Channel.
Malone last year acquired an 18 percent voting stake in Rupert Murdoch's News Corp. Murdoch said Feb. 2 that an agreement to reduce Malone's stake in the company may be reached in nine months.
Biondi
Biondi was Viacom's CEO from 1987 until 1996, when Chairman Sumner Redstone ousted him, saying Biondi lacked the fast-paced and aggressive management style needed to run Viacom. Biondi, 60, became chairman and CEO of Universal Studios Inc. and since 1999 has been a senior managing director at Waterview Advisers LLC.
Tow until 2004 worked at Stamford, Connecticut-based Citizens Communications Corp., a telecommunications company, and its predecessors. Araskog sits on the board of ITT, International Steel Group Inc. and Rayonier Inc., a forestry products company.
Cablevision shares fell 13 cents today in New York Stock Exchange composite trading. They've risen 19 percent in the last 12 months.
Araskog declined to comment. Rattner didn't immediately return a call and e-mail seeking comment after business hours. Liberty spokesman Mike Erickson didn't immediately return a call seeking comment. Biondi didn't immediately return a call to his office after business hours.
Last Updated: March 3, 2005 02:51 EST
