Stock-based transaction being discussed
In a sign that some dealmaking may be afoot, NBC on Friday filed a form 13D with the Securities and Exchange Commission that suggests the Peacock could be poised to initiate a transaction with Cablevision and/or its cable program unit Rainbow Media.Document confirms that the GE-owned broadcaster is considering a stock-based transaction for some or all Rainbow Media assets. (Daily Variety reported exclusively on Sept. 22 that NBC was negotiating with Cablevision to acquire basic cable net Bravo for upward of $1.6 billion, possibly in stock.) Disclosure legally obligated While the filing’s short on specifics, the company may simply be acting in the name of full disclosure to confirm that a deal is being discussed. Under the Securities Exchange Act, minority shareholders are legally obliged to disclose possible activity or negotiations that effect the stock it holds. Anyone seeking to acquire more than 5% of a company’s securities by direct purchase or tender must disclose its intent. One analyst noted that in its filing NBC may be implying that it is atttempting to negotiate a partial swap of some of its Cablevision shares in part consideration for acquiring Bravo Channel. A deal for Bravo could conceivably be transacted entirely in shares. Such a transaction “wouldn’t help Cablevision or (fellow Rainbow) minority shareholder MGM at all,” said one fund manager who would prefer to see Cablevision get a sizable chunk of cash out of any disposal. NBC-Rainbow, a separately created holding company for NBC’s investment in the Rainbow cable channels, now owns 53,199,653 shares of CVC stock after the swap out of its Rainbow Media tracking stock last month. That reps 16.8% of total CVC outstanding shares (all classes).