Cablevision adds subscribers, exploring options

By Yinka Adegoke

NEW YORK (Reuters) - Cablevision Systems Corp added more subscribers than expected in the second quarter and comments from its CEO suggested that the Dolan family may try to take the cable company private again, sending its shares up more than 11 percent.

Cablevision Chief Executive Jim Dolan said on an earnings conference call that the company is exploring options to close the gap between its operating performance and its current market value.

"We are considering and actively exploring alternatives that may close this gap and want to assure investors that we will listen to their thoughts," Dolan said.

Analysts said Cablevision's options could also include spinning off its cable network unit Rainbow Networks, a special dividend, or aggressive share buybacks.

The Dolan family offered to take Cablevision private last October for $36.26 a share, but the deal was rejected by shareholders who deemed the price too low. Since then, the stock had fallen more than 30 percent before Thursday's jump.

Some analysts believe Cablevision's shares have suffered partly because of what has been dubbed the 'Dolan Discount,' due to unexpected management decisions such as the company's purchase of the Long Island newspaper Newsday for $650 million in May.

"The Dolan Discount is more than offset by the company's willingness to restructure," said Tom Eagan, an analyst at Collins Stewart, who rates the stock a "buy."

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