AMC Networks said its long-time executive chairman Charles Dolan will step down, becoming chairman emeritus of the programmer as his son and board member James Dolan was named non-executive chairman of the company.
An icon and innovator in the cable business -- he created what would become HBO in the 1970s -- Charles Dolan, 93, has been executive chairman of AMC Networks ever since it was spun off from the former Cablevision Systems in 2011.
News of the executive changes comes as AMC said it will buy back about $250 million worth of its shares through a modified Dutch auction beginning Sept. 16. AMC will purchase Class A shares in the company at a price of between $22.50 and $26.50 per share (a nearly 28% premium to their closing price of $20.77 each on Sept. 15).
AMC shares have been hit hard during the pandemic -- prior to the buyback announcement the shares were down 7.7% on Sept. 15 to $20.77 each and have fallen 47% for the year. News of the buyback sent the shares up about 17% ($3.48 each) to $24.25 per share in after-hours trading Tuesday.
In a modified Dutch auction, shareholders indicate how much stock and at what price they want to sell it within a specific range. The structure helps show a company’s confidence that the stock will return to its previous levels.
“AMC Networks has a strong financial position and the proposed tender offer is a significant expression of strength and the Board’s confidence in our company’s future,” AMC CEO Josh Sapan said in a press release. “The Dolans have led this company from its inception, and both Charles and Jim have provided vision, guidance and support through its long history of growth and evolution. We look forward to their continued leadership as AMC Networks continues to stand out in a crowded environment through the strength and quality of our content and ability to forge strong and lasting relationships with viewers and fans.”
Earlier Tuesday AMC Networks said its chief financial officer Sean Sullivan will step down in mid-October to take a job with another company. In a Securities and Exchange Commission filing, AMC said Sullivan's departure was not related to any disagreement with the company concerning its operations, policies or practices. Later in the day satellite radio giant Sirius XM said it had named Sullivan as its new CFO, effective Oct. 26.
The joint dealer managers for the tender offer are BofA Securities, Inc. and Citigroup Global Markets Inc. D.F. King & Co., Inc. is serving as information agent for the tender offer and Equiniti Trust Company is serving as the depositary for the tender offer.
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