The impending departure of Cablevision COO Tom Rutledge has analysts emphasizing how crucial he is to the company and speculating on the very future of it.
Bernstein’s Craig Moffett wrote that no company in the telecom/cable/satellite sphere he follows was as reliant on an executive as Cablevision. He called it “key man risk” and further wrote that Rutledge was “the hands-down best executive in the industry.”
Cablevision shares were trading down about 9% midday on Friday at about $12.70.
Wells Fargo’s Marci Ryvicker wrote that Rutledge;s departure puts Cablevision’s “future into question.” Moffett weighed in on the potential for Cablevision to be acquired, saying Rutledge was an “impediment” to an acquisition by Time Warner Cable because he did not get along with TWC CEO Glenn Britt.
Also, Cablevision would be expensive, and TWC’s strategy does not fit with the possible cost, Moffett wrote. While Comcast could be a potential acquirer, it is mired in trying to integrate NBCUniversal.
Moffett and Ryvicker both suggested that a reason for Rutledge’s resignation -- although none was given -- was frustration in dealing with the Dolan family, the controlling shareholders. Moffett noted that John Bickham, the president of the cable operations, also left the company recently and may have had issues with the Dolans.
Ryvicker thought he might have another CEO job lined up, perhaps at cable company Charter. However, she wrote that his contract, which was scheduled to expire at the end of 2014, has a one-year non-compete clause. (Moffett suggested that Bickham and Rutledge may be going somewhere together.)
Rutledge, who has been COO since 2004, ushered in a streamlining of the company, the acquisition of the Bresnan systems and technological innovations.