Cablevision, Bronfman View VUE

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Cablevision Systems Corp. vice chairman Bill Bell hinted that the Bethpage,
N.Y.-based MSO could be interested in teaming up with former Seagram Co. Ltd.
CEO Edgar Bronfman in making a bid for Vivendi Universal's Vivendi Universal
Entertainment assets.

News that Cablevision was in talks to back Bronfman broke in TheNew York Times and TheWall Street Journal Wednesday
morning.

According to the Journal, Bronfman -- who sold Seagram (including the
entertainment assets) to Vivendi in 2001 -- was assembling backers to make a bid
for the entertainment properties. The paper said Cablevision would contribute
its Rainbow Media Holdings Inc. programming assets to the deal in exchange for
an equity stake of between 25% and 33% of the venture.

Media-investment banker Quadrangle Group LLC -- the chairman of which, Steve
Rattner, sits on Cablevision's board of directors -- would be involved in the
deal, as well.

Vivendi confirmed the reports that Bronfman -- who is also vice chairman of
the French conglomerate -- is planning to make a bid.

Vivendi issued a statement Wednesday saying that Bronfman informed Vivendi
chairman Jean-Rene Fourtou of his intention to lead a consortium of potential
purchasers. The company did not identify his partners.

At the Banc of America Securities LLC media conference Wednesday, Bell would
not confirm the deal, but he hinted that it is being discussed.

"In this business, everybody talks to everybody," Bell said. "Vivendi has
very attractive assets and Rainbow has very attractive assets. Perhaps we can
fit them together in some fashion. We will have to see where it leads."

VUE has been on the block since November, when Texas oil billionaire Marvin
Davis made an unsolicited $20 billion bid, including $5 billion in debt.

Since then, other possible suitors for VUE have included Viacom Inc., Liberty
Media Corp., Metro-Goldwyn-Mayer Inc. and General Electric Co.'s NBC television
unit. Former VUE co-CEO Barry Diller is also thought to be interested in a
deal.

Combining VUE's cable networks -- USA Network, Sci Fi Channel, Trio and
NewsWorld International -- with Cablevision's Rainbow properties could be a good
fit, according to some analysts. Rainbow includes AMC, WE: Women's
Entertainment, The Independent Film Channel and MuchMusic USA.

Also included in VUE are Universal Studios, Universal Music Group and
Universal theme parks

In a research note, UBS Warburg LLC cable debt and equity analyst Aryeh
Bourkoff wrote that although a Vivendi deal would be a departure from
Cablevision's recent strategy to divest noncore assets, it could be good for the
company at the right price and structure.

He added that such a combination effectively allows Cablevision "to divest
noncore noncable assets into an entity that could hold greater value overall
under outside control."

Bourkoff wrote that he would view the deal even more favorably if Cablevision
could find a way to contribute its direct-broadcast satellite venture to the new
entity.

At the BofA conference, Bell said Cablevision is aware that the DBS venture
is an issue with Wall Street, but he offered little clarity on the MSO's
plans.

"We are planning on launching a satellite in late July," he added. "We hope
to in short order be able to share what our initiatives are."

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