Cablevision: Voom Won't Die
The boardroom coup threatened at
Cablevision
(CVC)
last week by Chairman Charles Dolan paid its first dividend Tuesday when the company agreed to keep the troubled Voom satellite television venture alive.
Cablevision said it entered an agreement with Dolan, its chairman, and Thomas Dolan, his son, under which Voom will stay in service while the two try to arrange a transaction that would prevent its closure. Charles Dolan agreed to fund costs incurred by the service above any that would have been expensed "under a shutdown scenario."
The pact reverses Cablevision's previously stated intention of closing Voom, which has been losing money and recently sold its only working satellite to
EchoStar
(DISH) - Get Report
. Since Cablevision announced that plan, Charles Dolan said he planned to replace three Cablevision directors and one board vacancy with four new board members of his choosing.
Dolan, who controls a special supervoting class of stock that enables him to elect a majority of the board if he wants, indicated last Wednesday that he would exercise that right when the company holds its annual meeting in May.
The agreement, which was approved by the Cablevision board and a special committee of independent directors, terminates on March 31.