ITT INCREASES ITS CASH POSITION -- PRELUDE TO A BID FOR CBS?
Continuing its restructuring, ITT Corp. said that it would
sell three buisnesses from its ITT Financial Corp. subsidiary to
GE Capital Corp. for $1.8B. The deal is the third sale of
portions of ITT's financial subsidiary, as the company is seeking
to expand its entertainment segment and raise a net of around $3B
in the process. Analysts estimate ITT Corp. would net about
$400M from the sale to GE Capital. ITT management has said it is
considering breaking ITT Corp. into three separate companies:
ITT Hartford (insurance), ITT Industries (manufacturing) and ITT
Sheraton/Caesars World (hotels, gaming and entertainment). ITT's
shares rose by $1.50 to 96 3/4 on NYSE upon news of the deal
(Kenneth Gilpin, N.Y. TIMES, 2/15). Some Wall Street "insiders"
speculate ITT's added cash could go toward a bid for CBS, which
some analysts see as a "good strategic fit for the emerging
entertainment group." This week, ITT is finishing its deals for
MSG (with partner Cablevision) and Caesar's World (Paul Tharp,
N.Y. POST, 2/15).