Westinghouse Electric is expected to announce today an
agreement to purchase CBS at $81 a share or about $5B, "people
familiar with the transaction" told this morning's WALL STREET
JOURNAL. Seven Lipin and Elizabeth Jensen report that "the
boards of the two companies are scheduled to meet this morning to
vote" on the deal, with an announcement expected today (WALL
STREET JOURNAL, 8/1).
HOLD EVERYTHING! After yesterday's Cap Cities/ABC- Disney
merger, speculation "has intensified" that another company, such
as a Hollywood studio, might try to outbid Westinghouse. The
Disney-ABC deal "could well raise the value of media properties,
such as networks." Even Cap Cities/ABC Chair Thomas Murphy
"quipped yesterday" that the merger of his company with Disney
means that CBS Chair Laurence Tisch probably "can get more for
his company today." Shares of CBS jumped $1.88 to $77.15 on news
of yesterday's Disney/ABC deal (WALL STREET JOURNAL, 8/1). John
Durie writes in this morning's N.Y. POST, "If the likes of Ted
Turner and Edgar Bronfman Jr. at Seagram were thinking about
buying a television network, yesterday's deal raises the urgency"
(N.Y. POST, 8/1). Susannah Patton of DOW JONES NEWS SERVICE
writes, "CBS Inc. suddenly looks a lot more popular." Patton
notes that while Disney can provide programming for ABC,
"Westinghouse would only add distribution to CBS," making
"potential bidders that could provide programming" more likely
"to jump into the bidding arena." Patton also mentions
Bronfman's Seagram Co. and Turner, along with Viacom, Time
Warner/TCI and Barry Diller as potential suitors (BOSTON GLOBE,
8/1). Turner is said to be close to a deal with King World
Productions, "which has enough cash on hand to allow Turner to
proceed to buy CBS," (Claudia Carpenter, N.Y. POST, 8/1).
PEACOCK BACK IN PLAY? The N.Y. POST's Durie also writes
that yesterday's deal could potentially land NBC on the market.
Durie: "Jack Welch at General Electric may also consider selling
NBC if this deal sets off a bidding war for the newly "scarce'
television networks" (N.Y. POST, 8/1). Dillon Read analyst
Edward Atorino also notes the possibility of an NBC sale.
Atorino: "Welch may be saying that broadcasting isn't such a big
part of the business. He may unlock NBC" (BOSTON HERALD, 8/1).
MOVEMENTS BY FOX TOO? CNN's Steve Young: "Some analysts say
the Disney deal will also push Rupert Murdoch to expand using a
recent $2 billion MCI investment in his News Corp. empire"
("Moneyline," CNN, 7/31).
OTHER NBC NEWS: NBC has apparently offered to buy Outlet
Communications -- the owner of several NBC affiliates -- for more
than $396M, according to this morning's N.Y. TIMES. The bid
would renew a bidding war with Renaissance Communications, which
offered $360M for Outlet in late June. Renaissance, which owns
several top-50 Fox affiliates, responded to NBC's bid by suing
both companies. A hearing is scheduled for today (N.Y. TIMES,
8/1).
