Cablevision Systems' investors today shunned the $10.6 billion offer from the Dolan family, CVC's controlling shareholders, to go private.
Voters apparently felt low-balled by the $36.32 per-share deal (though the offer is well-above the stock's current 20-day and 50-day moving averages), stating they believe the company was worth up to $50 a share (a number they haven't seen since 2001). The failing bid marks the third thwarted effort to privatize the cable operator by the Dolan family.
Now that this privatization bid has been circumvented, Cablevision Systems may be under duress to boost its stock price. CVC investors may have flubbed in turning down the deal, considering the share price has dropped almost 14% since the Dolans' offer was made in May, when CVC shares dawdled around $36.35. Over the summer, the stock rose to $38.81 in early July, but tumbled to $32.45 on August 17. After meeting support at its 10-day moving average and resistance at its 20-day moving average through most of September, CVC dropped yet again to hit the 31 level for the first time since April.
According to figures released by the Nasdaq, short interest has increased more than 17% from a month ago, with 1.19% of the stock's float shorted. Short-term options players continue to bet against the stock with increased pessimism, as CVC's Schaeffer's put/call open interest ratio (SOIR) checks in at the 99th percentile. According to Zacks, 7 of the 11 analysts following the equity rate it a hold or worse.
Shares of CVC are currently down 2.79% during intraday trading.