Cablevision May Sell Assets, Cuts Forecast

Cablevision Systems Corp. said Friday that it is considering selling some assets as it reduced earnings expectations for 2001 and canceled a $1-billion stock offering.

Shares of Cablevision, the New York City area’s largest cable television operator, fell 11%.

The company didn’t say what it might sell in its New York unit, which includes the Wiz chain of consumer electronics stores, Madison Square Garden and Radio City Music Hall.

A sale of cable subscribers to AOL Time Warner Inc., Cablevision’s next-largest New York City rival, is expected by some analysts and investors. Cablevision, controlled by the family of Chairman Charles Dolan, owns cable systems serving 3 million homes.

“This dramatically expedites the sale of Cablevision,” said Uri Landesman, chief investment officer at AFA Management Partners, which owns shares of the company and AOL Time Warner. “They’re basically putting the for-sale sign on.”

AOL Time Warner, the second-largest U.S. cable operator, declined to comment, spokesman Ed Adler said. Cablevision doesn’t comment on speculation, spokeswoman Kim Kerns said. New York-based AOL Time Warner has 1.2 million cable customers in Manhattan and parts of suburban New York and New Jersey. Cablevision has customers in both those areas and in southern Connecticut.

Cablevision cited general market conditions for dropping the planned sale of $1 billion in convertible preferred stock.

AT&T; Corp., the biggest U.S. cable and long-distance phone company, said it will proceed with a plan to sell its 49.8 million shares of Cablevision, a stake of roughly 30% that’s valued at $2.22 billion, based on Thursday’s closing price.

Shares of Bethpage, N.Y.-based Cablevision fell $4.83 to close at $39.67 on the New York Stock Exchange. They’ve dropped 37% in the last year. AOL Time Warner fell 29 cents to close at $33.81, also on the NYSE.

Cablevision said it expects 2001 earnings before interest, taxes, depreciation and amortization--known as cash flow--to rise 10% to 12% at its cable and telephone businesses, citing lower advertising sales because of the Sept. 11 terrorist attacks. Its previous forecast was for a gain of 11% to 13%.

Cash flow from the Madison Square Garden operations is expected to be $80 million, down from earlier estimates of as much as $120 million, as fewer people will attend events in the wake of the attacks, the company said.

Cablevision owns the Knicks of the National Basketball Assn. and the Rangers of the National Hockey League, which both play at Madison Square Garden.

It also controls Rainbow Media Group, which owns networks such as American Movie Classics and Bravo. Fox Entertainment Group Inc., General Electric Co.’s NBC TV network and MGM Inc. own stakes in some Rainbow networks.