Cablevision is no longer an exclusively East Coast, big market MSO. It has closed on its acquisition of Bresnan Communications, which extended its footprint to a bunch of small markets way out West.
The $1.365 billion purchase gave Cablevision systems serving approximately 297,000 basic cable television subscribers and more than 629,000 homes passed in Montana, Wyoming, Colorado and Utah. That adds to Cablevision’s East Coast base of about 3.1 million subscribers in New York, New Jersey and Connecticut.
“We have tremendous respect for the Bresnan management team and employees and the quality they have provided for many years to a growing base of cable, high-speed Internet and phone customers. We look forward to continuing this history, this strong commitment to localism and local operations, and to delivering even more features and value including faster Internet, more HD programming and other meaningful enhancements to our customers in these markets,” said
Cablevision COO Tom Rutledge.
The Bresnan acquisition is structured as a newly-formed, independent, unrestricted subsidiary of Cablevision. It was financed using an equity contribution by Cablevision of approximately $400 million and non-recourse debt of approximately $1 billion. The newly-formed subsidiary’s capital structure consists of a $75 million Revolving Credit Facility, a $765 million Term Loan Facility and $250 million 8.0% Senior Notes due 2018.
Moody’s Investors Service said recently that Cablevision’s Ba2 Corporate Family Rating (CFR) and SGL-1 liquidity rating would not be affected by the Bresnan acquisition. Also, Moody’s said Cablevision’s ratings outlook remained positive.
RBR-TVBR observation: The one thing you can say about this strange deal is that just about anything else that Cablevision might buy could be viewed as a “fill-in” acquisition. But there is sure a lot of territory to fill in!