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COMSAT TO SPIN OFF ENTERTAINMENT ASSEST TO ATTRACT INVESTORS
Published August 4, 1995
Comsat, the satellite communications company that owns the Nuggets and the Denver NHL team is ready to "spin off its entertainment assets as a new subsidiary," according to James Sterngold of the N.Y. TIMES. Since the stock market has "generally continued to treat the company like a staid telecommunications utility" and not as an entertainment business, Comsat "has decided to act" -- and some investors "may be warming up to the company." Comsat has hired Allen & Company to examine the organization's structure which is expected to "mean the creation of a subsidiary that is likely to be spun off at least in part to shareholders before the end of the year." The new unit would likely be based in Denver. Ivan Arteaga, analyst with Gabelli & Co., said the spinoff is "a great idea. There's a lot more value in that stock." Arteaga figures the company could have a value as much as $50 a share if it "was sold privately." Comsat closed yesterday on the NYSE at $23.125, and had a low of $17.625 in mid-March (N.Y. TIMES, 8/4). In Denver, Comsat President Bruce Crockett: "There is an entertaiment frenzy going on and we intend to act on it" (ROCKY MOUNTAIN NEWS, 8/4).