Cablevision Eyes Spinoff of Cable Networks

BETHPAGE: Cablevision Systems Corporation is looking into spinning off Rainbow Media Holdings, its division encompassing AMC and Sundance Channel, among other businesses, to stockholders in a tax-free transaction.

The company’s board has approved filing the necessary documents with the Internal Revenue Service to seek a private letter ruling with respect to the transaction’s tax-free status. Announcing the spin-off proposal, a company statement noted, "Cablevision is confident of the strength of the Rainbow business, which houses an attractive portfolio of programming assets, and believes that the spin-off has the potential to enhance the value of that business and Cablevision, thereby providing each company with greater flexibility to pursue strategic objectives."

If approved, the spinoff will create a separate business consisting of AMC, WE tv, IFC, Sundance Channel and Wedding Central; IFC Entertainment; and Rainbow Network Communications (RNC). Remaining within Cablevision would be its flagship cable and telecommunications business, Newsday, News 12 Networks, MSG Varsity and Clearview Cinemas. The company has said a target of mid-2011 to complete the spinoff.