Cablevision's Rainbow buys Sundance Channel for $496M

CVC purchases Robert Redford's independent TV unit

BY JAMES BERNSTEIN | james.bernstein@newsday.com

12:34 PM EDT, May 7, 2008

Cablevision Systems Corp., the largest provider of cable television in the New York metropolitan area, said Wednesday it has agreed to buy the Sundance Channel for $496 million. The channel specializes in independent programming and is probably best known as the brain-child of actor Robert Redford.

Bethpage-based Cablevision, which is said to be offering $650 million to Tribune Co. owner Samuel Zell for Melville-based Newsday, wound up the winner for Sundance over other bidders, including Time Warner Inc. and Viacom.

The Sundance Channel, which offers original films and documentaries, is currently offered on Cablevision iOSilver and iOGold packages.

The Sundance Channel is known for Redford's "The Green," documentaries about the environment, and "Iconoclasts," which presents discussions by innovative personalities.

Cablevision said in an announcement that it is paying for Sundance through a tax-free exchange of about 12.7 million shares of General Electric Co stock held by Cablevision's Rainbow Media unit.

Cablevision purchased the channel from co-owners NBC Universal Inc., CBS Corp. and Redford.

The channel, started by Redford in 1996, has about 30 million subscribers. Cablevision said in its announcement that Sundance will continue to "benefit from its continuing relationship" with Redford, although it did not explain specifically what that relationship would be.

Cablevision said its Rainbow unit will own 100 percent of Sundance. Sundance, it said, will join Cablevision's AMC, IFC and WE tv channels as a "distinct network."

The Sundance Channel, headquartered in Manhattan, has about 70 employees. Joshua Sapan, Rainbow's president and chief executive, said in a statement that the channel has a "distinct voice" through programming like "The Green" and "Iconoclasts." "Our vision is to build on this type of original content, further strengthening the uniqueness of the network."

Cablevision is bidding against News Corp., owned by Rupert Murdoch, and Mort Zuckerman, who owns the New York Daily News, for Newsday. Murdoch has offered $580 million for Newsday, and has signaled he does not plan to raise his bid.

In mid-day trading, Cablevision shares were up 68 cents to $24.37.