Jeff Bercovici |
by: Jeff Bercovici posted on: May 05, 2008 | about stocks: CVC / NWS / NYT
Possibly you’re wondering why Cablevision (CVC) has inserted itself into a fight between a couple of partisan newspapermen for Newsday. Kevin Kamen, president of the media appraisal firm Kamen & Co., has a few thoughts on the subject, plus a prediction:
This acquisition does three things for Cablevision. It provides the Dolan family with full control over the editorial debate/news media agenda on Long Island since it already owns the dominant television station, cable’s News12. Secondly, it gives them leverage to directly monopolize the advertising agenda onLong Island, whether via digital or print, by offering one-stop shopping and pricing. Lastly, by acquiring the other properties that are part of the Newsday family — AM New York, Distinction wedding magazine, Star Community Publishing, etc. — it corners the market and helps them to better market and promote their entire entertainment and sports portfolio in a structured cross brand technique.
Kamen’s disquisition also included a forecast that Newsday will eventually sell for eight to nine times its net profit of $80 million, putting the upper end of the range at $720. While Cablevision currently has the high bid, at $650 million,as The New York Times pointed out over the weekend, that bid assumes the sale will include Newsday‘s real estate, valued at up to $30 million. Under News Corp. (NWS) and Mort Zuckerman’s proposals, Tribune Co. would get to keep the real estate.