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Liberty: Rainbow a 'fit'
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December 6, 2000: 2:25 p.m. ET
Liberty CEO: Rainbow Media would 'fit well' - bidding prospects are unclear
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NEW YORK (CNNfn) - A top Liberty Media Group executive noted Wednesday that the Rainbow Media programming assets would "fit well" within his company's expansive portfolio of investments, but declined to speculate on the media and technology company's chances of successfully bidding for the operation.
Speaking to analysts and investors at the UBS Warburg Media Conference in New York, Liberty Media Chief Executive Robert Bennett would not comment directly on recent media reports that his company, in conjunction with USA Networks Inc., had expressed interest in buying Rainbow, the programming arm of Cablevision Systems Corp. (CVC: Research, Estimates).
He did note that the company's programming assets would fit snugly into Liberty Media's broad portfolio of cable and communications networks. However, he hinted that Liberty Media -- which is a unit of AT&T that trades under a separate tracking stock -- was unlikely to emerge the winner of a drawn-out bidding war for the operation.
"Clearly, they have assets that would fit well with some of our own," Bennett said. "Whether something would happen at the end of the day though, I don't know. We tend not to be the highest bidder" in these types of situations.
 Cablevision announced plans in August to spin off Rainbow into a separate tracking stock. Rainbow's holdings include the Independent Film Channel, American Movie Classics, Cablevision's 50 percent stake in national sports network Fox Sports Net, and Sterling Digital, Rainbow's programming incubator.
Cablevision owns a 74 percent stake in Rainbow with General Electric Co.'s NBC owning the remaining shares. The operation accounts for roughly one-third of Cablevision's $3.9 billion in annual revenue.
The Bethpage, N.Y.-based Cablevision has now twice postponed a scheduled shareholders' vote to approve the spinoff, saying it continues to evaluate all of its options and alternatives regarding the company.
The Wall Street Journal reported Monday that several companies, including USA Networks (USAI: Research, Estimates) and Liberty Media (LMG.A: Research, Estimates), had approached Cablevision about deals for Rainbow's assets. Other possible bidders mentioned by the Journal included Comcast Corp.
As part of his presentation Wednesday, Barrett indicated that the company was preparing for an overall slowdown in the media industry during the next few months as both advertising and general economic trends slowed.
"Our view of the next several months has turned somewhat bearish," he said. "You don't need to be a rocket scientist to see the warning signs out there."
As a result, Barrett said Liberty Media was focused on preserving its cash, although he did not rule out taking on more debt to pursue an acquisition. He said the recently announced plans to spin the company off entirely from parent AT&T Corp. should help it not only raise capital, but pursue acquisitions that were impossible before because of regulatory concerns.
"We had reached a point where there were benefits to being part of AT&T, but we've now reached a point where the detriments outweigh the benefits," he said.
AT&T (T: Research, Estimates) hopes to spin the company off during the second quarter of next year assuming the Internal Revenue Service rules the transaction can be completed tax free.
Liberty Media shares climbed 25 cents to $14.31 in mid-afternoon trading Wednesday. 
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Cablevision
AT&T Corp.
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