NEW YORK (
(CVC - Get Report)
winning bid for
sends shares of small cable shops like
Cablevision's $1.36 billion deal
for Western cable specialist Bresnan translates to a whopping $4,266 per subscriber.
In an effort to appease peeved shareholders, the Bethpage, N.Y. cable shop said Monday that it plans to launch a $500 million share buyback.
Investors eyeing the Cablevision/Bresnan deal have taken a new look at Mediacom. Mediacom's board is currently evaluating a $6 per share offer from its CEO Rocco Commisso, who already holds 40% of the outstanding shares -- and 81% of the voting power for the company.
Given the value Cablevision bestowed on Bresnan, Commisso's $6 per share bid appears cheap. Wall Street seems to think so also. Mediacom shares have risen 11% since Commisso's June 1 take-private buyout offer. Mediacom shares rose to $7.01 in early trading Monday.
Per subscriber valuations are nothing more than rough calculations, but this one is a little rough on Commisso's offer. The $6 a share take private bid values Mediacom at $3,325 per sub.
With a new level of cable valuation, courtesy of Cablevision, investors see some upside in Mediacom.
--Written by Scott Moritz in New York.