News that Luxembourg-based telecom conglomerate Altice SA is buying Suddenlink Communications helped spike Cablevision (NYSE: CVC) shares as high as 18 percent Wednesday, with analysts and investors speculating that the Bethpage, N.Y., MSO could be next in line for acquisition.
In fact, Cablevision Systems was the best performing stock in the S&P 500 Wednesday, with Pivotal Research Group upgrading the MSO's stock from "buy" to "hold."
According to Pivotal's Jeffrey Wlodarczak, Altice's $9.1 billion proposed purchase of a 70 percent controlling interest in Suddenlink Wednesday, combined with Cablevision's publicly expressed enthusiasm to sell, make a deal for Cablevision more likely.
Cablevision is seen by analysts as an attractive target, controlling 3.1 million customers--including 2.7 million pay-TV subscribers--in the suburban areas adjacent to New York City. Acquisition of this suburban cluster would fit nicely with a purchase of Time Warner Cable (NYSE: TWC), which has Manhattan's cable franchise agreement.
Speaking on an INTX panel in Chicago earlier this month, Cablevision CEO James Dolan openly welcomed a merger, suggesting consolidation of the New York market "would fuel ingenuity, provide much more access to resources for the customers, and lower prices."
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