Wednesday, May 2, 2007
Cablevision Systems Corp.'s board of directors has, according to CNBC, agreed this morning to a buyout offer by the Dolan family to take the cable operator private for $36.26 per share. The price is a 21 percent premium to their $30 per share offer on January 12, 2007. This will be the third time that the Dolan family has tried to take the company private. Dealscape has a history of the tortured deal here.
Update: The Cablevision/Dolan family joint press release is here. Note the following language in the press release:
Lawyers representing shareholders in the pending going private action in Nassau County Supreme Court actively participated in the negotiations, which led to improvements to the financial terms of the transaction as well as significant contractual protections for shareholders. Included in the monetary benefits provided to shareholders in the transaction is additional merger consideration payable directly to the shareholders in exchange for succeeding to Cablevision’s and shareholders’ rights in connection with claims involving alleged options backdating. The parties have agreed in principle to the dismissal of the pending going private litigation, subject to approval by the Nassau County Supreme Court.
For those reading between the lines, it likely means that the Dolan family has agreed to pay and support an award of attorneys fees to the plaintiffs' attorneys for their acquiescence to the deal and dropping the suit (I would guess that the attorneys were probably even nice enough to suggest this language). Instead of commenting, I'll link to Vice Chancellor Strine's opinion in In re Cox Communications about the perils of such practice under Delaware law and the possibility of selling minority shareholders short, particularly here where the Dolan family has been repeatedly accused of underbidding for Cablevision.