The third time was the charm for Cablevision Systems founder and Chairman Charles F. Dolan and his son, Cablevision CEO James L. Dolan, as the board of directors of the company accepted the Dolan family’s most recent offer to buy the company and take it private. Cablevision valued the deal at $22 billion.

The Dolan Family Group has formed a company that will buy all outstanding shares of Cablevision they do not already own for $36.26 a share in cash. Previous offers were $27.00 a share on October 8, 2006, and $30.00 a share on January 12, 2007.

The Dolans have agreed to unspecified additional merger consideration payable directly to the shareholders. The provision is an apparent nod to the possibility that the Dolan family may yet sell the company to another cable company. Speculation frequently falls on Time Warner Cable, which operates cable systems in contiguous areas in the New York City market.

The Dolan Family Group will contribute approximately $2.1 billion in equity to the transaction through reinvestment of its Cablevision shares in the new privately-held company. Merrill Lynch; Bear, Stearns; and Bank of America are contributing a total of about $15.5 billion in debt financing to fund the merger consideration and refinance certain bank indebtedness of Cablevision. The company's existing notes and debentures will remain outstanding.

Earlier this week, Cablevision sold off its interest in two regional sports networks to Comcast (see story). The $570 million from that deal may have helped grease the skids for the transaction.

In recent years, the cable industry has asserted that cable stocks have been undervalued, typically attributed to investor skittishness over capital spending. Cablevision is the third large MSO to go private, after Insight Communications and Cox Communications, which may not prove the point but certainly proves the industry’s conviction.

Cablevision's closing price the day before the first offer was $23.93. The successive offers helped drive Cablevision’s stock higher and higher. The news of the offer today drove the stock price up again – by $2.70 to $35.35, as of mid-day.

Cablevision serves 3.1 million households in the New York metropolitan area. Cablevision's Rainbow Media Holdings LLC owns several programming channels including AMC, IFC, and WE tv. Cablevision also owns Madison Square Garden and its sports teams, the New York Knicks, Rangers and Liberty. The company also operates Radio City Music Hall and the Beacon Theatre, and owns and operates Clearview Cinemas.