Cablevision not interested in Newsday: source

NEW YORK Wed Apr 9, 2008 6:28pm EDT

NEW YORK (Reuters) - Cable television operator Cablevision Systems Corp (CVC.N) is not interested in buying Newsday from the Tribune Company, contrary to press reports, a person familiar with the matter told Reuters on Wednesday.

Separately, New York Daily News owner Mortimer Zuckerman, has made a bid for the Long Island daily newspaper, according to another source familiar with the matter. Details of the bid were not immediately available.

Newsday, currently owned by Tribune, is in talks with News Corp's NWSa.N Rupert Murdoch for a sale or a joint venture, sources have previously told Reuters.

One source close to News Corp said on Wednesday those talks continue.

Several media outlets have said James Dolan, whose family controls Cablevision, is interested in acquiring the paper but that is not true, the person familiar with the matter told Reuters.

Murdoch publicly said last week Newsday would be a good fit with the company's New York Post, but a deal could face hurdles with regulators because it could run afoul of U.S. media ownership regulations.

A Tribune spokesman declined to comment.

Real estate tycoon Sam Zell took Tribune private last year in an $8.2 billion leveraged buyout that restructured the publisher of the Los Angeles Times as an employee-owned company, saddling it with more than $10 billion in debt.

Many industry experts have said they see no option for the company to avoid default except for unloading assets to pay down its debt.

Analysts have said Newsday could fetch between $350 million and $600 million and have speculated that News Corp could either buy Newsday outright, or form a joint venture that would allow Murdoch to combine the back-office operations of Newsday and the New York Post.

Newspapers have been struggling with declining ad revenue and waning readership as more advertisers and readers move to digital media and get their news and place their ads online.

Also some of Tribune's most well known and largest newspapers, including the Chicago Tribune, the Los Angeles Times and the Orlando Sentinel, are hurting because of their exposure to the struggling real estate markets in California and Florida.

(Additional reporting by Kenneth Li)

(Reporting by Jui Chakravorty and Robert MacMillan; editing by Carol Bishopric)