Cablevision Systems Corporation, the family-controlled media, entertainment and sports company, has announced it will acquire Bresnan Communications from Providence Equity Partners in a deal worth $1.4 billion.
In a statement released yesterday, Cablevision said it would finance the deal by borrowing $1 billion in non-recourse debt with the company providing the further $400 million.
Second-generation Cablevision president and CEO James Dolan (pictured) said: "We believe the acquisition of Bresnan is an excellent opportunity to leverage Cablevision's strong management team and build shareholder value. Bill Bresnan was a cable legend and was close to so many in the industry, including the Dolan family.
"The Bresnan team has built an impressive cable business that performs well financially, and we look forward to working to enhance those systems further," he said.
The acquisition will see US-based Cablevision expand its services beyond the New York City area it has traditionally served to the western states of Colorado, Montana, Wyoming and Utah that Bresnan serves. It will also pick up Bresnan's 300,000 subscribers.
Cablevision also announced yesterday the board of directors has authorised a stock repurchase programme of up to $500 million in Class A common stock. According to Dolan: "This new stock buyback programme is a reflection of our confidence in both Cablevision's operating performance and potential to generate free cash flow.
"In addition, we believe that the repurchase programme will help to better align the market value of the company's common stock with Cablevision's underlying operating performance," he said.
James Dolan is the son of Cablevision founder Charles Dolan, who still serves as chairman. The company had a successful 2009, increasing revenues from $7.2 billion in 2008 to $7.8 billion in 2009.
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