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Biz Briefs

Jun 9, 2003  •  Post A Comment

Domestic diva Martha Stewart on Wednesday stepped down as chairman and CEO of Martha Stewart Living Omnimedia, just hours after a federal grand jury returned a nine-count indictment against her and her stock broker, alleging the pair lied to investigators in connection with her sale of 4,000 ImClone Systems shares. She has pleaded innocent to the charges.
Taking over the lifestyle company’s CEO position is Sharon Patrick, who had been president and chief operating officer. The company’s board named Jeffrey Ubben, a board member and managing partner of MSLO shareholder ValueAct Capital, as chairman. Ms. Stewart remains a board member and the company’s chief creative officer.
In addition to the indictment, the Securities and Exchange Commission filed a civil complaint against Ms. Stewart and Peter Bacanovic, her stock broker, for their roles in covering up what the SEC and federal prosecutors allege was an illegal sale of ImClone shares. The agency seeks to bar Ms. Stewart permanently from running a public company.
Cablevision Spins Off Theaters, Satellite Firm
Cablevision Systems said it will spin off its fledgling satellite company and movie theater chain into a separate company, as it continues to pare down its debt and focus more on its cable and entertainment business
The Bethpage, N.Y.-based multiple-system operator plans to spin off its Rainbow DBS and Clearview Cinemas chain in a tax-free, pro rata transaction to Cablevision shareholders by the end of the year. As part of the separation, Cablevision will inject up to $450 million in cash into the new entity and has received board approval to provide another $114 million investment in Rainbow directly for the balance of the year.
Cablevision’s move comes as it joins forces with Vivendi Universal Vice Chairman Edgar Bronfman Jr. to make a bid for Vivendi Universal Entertainment, which is for sale. Cablevision has committed to combine cable channels in exchange for a stake in a new media company that would include VUE’s businesses.
Comcast-Charter Deal Delayed
Comcast on Monday said that billionaire Paul Allen would delay for a third time purchasing Comcast’s stake in Charter Communications, as the two parties continue negotiating a cable-system swap in lieu of forcing Mr. Allen to pay $725 million to settle an arrangement Charter has with Comcast. A deal is expected by the end of June.
Mr. Allen, chairman of Charter and co-founder of Microsoft, and Comcast have been in talks for the better part of the year over the so-called “put,” which has negative tax implications for Comcast if Mr. Allen pays. Comcast inherited the put when it acquired AT&T Broadband last year.
Houlihan Acquires Media Connect
Houlihan Lokey Howard & Zukin on Thursday said it acquired Media Connect Partners, a financial advisory services firm specializing in media sports and communications companies. The purchase will bolster the Los Angeles-based investment bank’s entertainment business just as M&A activity in the sector is heating up.
As part of the deal, Los Angeles-based Media Connect’s founders, Gary Adelson, Tracy Dolgin and Jon Richmond, will join Houlihan Lokey as managing directors in charge of the bank’s media and entertainment investment banking group.