In Business This Week: HEADLINER
JAMES DOLAN: LIKE FATHER, LIKE SON
Finally, good news at Cablevision Systems has shareholders tuning in. On June 9, the company announced it would pick up 10 cable systems serving 820,000 New York customers from rival Tele-Communications, in return for 33% of Cablevision and the assumption of $669 million in debt.
Cablevision says the deal also marks a changing of the guard at Cablevision. Instead of Chairman Charles Dolan at the negotiating table with TCI chairman John Malone, it was son James, 42, who did the dealing with TCI, say officials at the Woodbury (N.Y.) company.
Cablevision is pushing James, CEO since October, 1995, more into the spotlight. But not everyone thinks he's really the chief wheeler-dealer. "Get serious," says Smith Barney analyst John Reidy. "This is John Malone and Charles Dolan. There wouldn't have been a deal" without them.
But stockholders don't seem to care: By June 11, Cablevision stock was up 41%, to 49, from its June 6 close.EDITED BY KELLEY HOLLAND By Jennifer ReingoldReturn to top
MURDOCH EXITS FROM ORBIT
RUPERT MURDOCH MAY HAVE given up on his dream of a U.S. satellite-TV empire to call his own. But at least he's bailing out in style. Just six weeks after a much-hyped deal with EchoStar Communications got scotched, Murdoch is selling his satellites and orbital slots to archrival Primestar Partners for a stake in Primestar, valued at $1.1 billion. Primestar, a consortium backed by Tele-Communications, Time Warner, and Comcast, is also being reconstituted as an independent company. With $4.6 billion in assets and some $1 billion in revenues, it will be able to offer high-powered satellite signals nationwide. That should put the company in a strong position to give both EchoStar and market leader DirecTV a run for their money. "Oh, happy day," says Primestar CEO James Gray. "This is something we've been working toward for a long time."EDITED BY KELLEY HOLLANDReturn to top
SELF-SACRIFICE AT SALLIE MAE?
A WORLD-CLASS ROWER IN HIS younger days, Sallie Mae CEO Lawrence Hough usually relishes challenges. But locked in a grudge match against former Sallie exec-turned-dissident Albert Lord, Hough decided to bail. On June 11, he offered to step down after shareholders vote in July on whether to turn control of Sallie over to Lord's slate of directors. The proxy battle "had become personal," admits Hough. The departing CEO says his leaving could mollify Sallie shareholders and enable the company to beat back Lord's dissident group.EDITED BY KELLEY HOLLANDReturn to top
AOL SNAPS UP A BARGAIN
AMERICA ONLINE THINKS IT has found a buy in its deal with online retailer CUC International. In a three-year pact, AOL, based in Dulles, Va., will give prime placement on its various online services to CUC, which offers discount coupons for shopping, travel, and other services. CUC, based in Stamford, Conn., has 68 million members. It will pay AOL $50 million, to be credited against the future transactions and membership commissions that it expects to be generated by AOL's 8 million members.EDITED BY KELLEY HOLLANDReturn to top