" writeme += "

" writeme += "" writeme += "" writeme += "" writeme += "

" playme.document.write(writeme); playme.document.close(); if((navigator.appName == "Netscape") && (navigator.appVersion.substring(0,1) >= "3")) {playme.focus();} if((navigator.appName == "Microsoft Internet Explorer") && (navigator.appVersion.substring(0,1) >= "4")) {playme.focus();} if (playme.opener == null) { playme.opener = self; } } function play(vid,neth,netl,realh,reall) { var cm=GetCookie("playbar"); if (cm != null) { //if (cm=="nh" && neth=="t") { cm="hi.asx"; //if(aol||nstr||iebug) { //} else { // showvid('asf',vid+cm); //} } else { if (cm=="nh" && neth!="t") { this.sec=1; pbw(vid,neth,netl,realh,reall); } } if (cm=="nl" && netl=="t") { cm="lo.asx"; //if(aol||nstr||iebug) { //} else { // showvid('asf',vid+cm); //} } else { if (cm=="nl" && netl!="t") { this.sec=1; pbw(vid,neth,netl,realh,reall); } } if (cm=="rh" && realh=="t") { cm="hi.rmm"; if(aol||iebug) { } else { showvid('rm',vid+cm); } } else { if (cm=="rh" && realh!="t") { this.sec=2; pbw(vid,neth,netl,realh,reall); } } if (cm=="rl" && reall=="t") { cm="lo.rmm"; if(aol||iebug) { } else { showvid('rm',vid+cm); } } else { if (cm=="rl" && reall!="t") { this.sec=2; pbw(vid,neth,netl,realh,reall); } } } window.onerror = MSIE; // -->

logo
Tue, Aug 15, 2000
Where's Dewey?  Click Here!
real time quotes your portfolio registration help
biz bulletin
  Corporate
Financial
Healthcare
Technology
stocks
  Quotes
Top Performers
Screening
Interactive
Charting
funds
  Quotes
Top Perfomers
Screening
insider
  Stock of the Day
Tip of the Day
Periscope
Launch Live Ticker
Fox News Home

Indices Chart
Click on index
for more information
Murdoch to Expand Empire with Chris-Craft

NEW YORK — News Corp. Ltd. (NWS.N) (NCP.AX) on Monday said it had agreed to buy TV station owner Chris-Craft Industries Inc. (CCN.N) for $5.35 billion, creating a U.S. television powerhouse that expands Rupert Murdoch's highly profitable strategy of owning two stations in one city.

News Corp. controls the Fox television network and 22 U.S. television stations, while Chris-Craft affiliates own 10 broadcast television stations.

The deal would give News Corp. 13 stations in the top 10 U.S. markets, with two stations each in New York, Los Angeles, Salt Lake City and Phoenix. It also would add to News Corp.'s existing dual ownership in Dallas.

In New York, News Corp already owns WNYW, Channel 5, and the New York Post newspaper and with the purchase of Chris-Craft would gain WWOR, Channel 9, a UPN affiliate. In Los Angeles, News Corp owns KTTV, Channel 11; and two regional Fox Sports cable networks; and would gain KCOP, Channel 13.

"I think it's a brilliant strategic move,'' Merrill Lynch analyst Jessica Reif Cohen said. "They were a powerhouse already, but now they are ahead by leaps and bounds,'' she said.

News Corp. on Monday said it agreed to pay about $85 a share in cash and preferred securities for Chris-Craft -- plus $165 a share for BHC Communications Inc. (BHC.A) and $150 a share for United Television Inc. (UTVI.O), Chris-Craft's station-owning affiliates.

Fox Entertainment Group Inc. (FOX.N), a majority-owned News Corp. subsidiary, would operate the stations under its Fox Television Stations unit.

News Corp., which also owns the 20th Century Fox film studio, expects the deal to immediately add to earnings and be completed by the end of fiscal 2001 on June 30.

News Corp. also would acquire about $1.4 billion in cash from Chris-Craft and expects to raise another $600 million from the divestiture of some of the TV stations.

In a conference call with analysts, News Corp. said the deal includes no break-up fee to compensate either party should the other terminate the deal.

Shares of Chris-Craft rose 16-1/4, or 26 percent, to close at 78-3/4 on the New York Stock Exchange. BHC rose 11-1/4, or nearly 8 percent, to close at 153 on the American Stock Exchange; and United Television rose 6-3/4, or nearly 5 percent, to close at 142-3/4 on Nasdaq.

News Corp. stock rose 3/8 to close at 50-1/8 after earlier trading as low as 47-3/8 on the New York Stock Exchange.

New York-based Chris-Craft has an 80 percent stake in BHC, which operates the 10 TV stations in Chris-Craft's television division. BHC owns three of the six Chris-Craft very high frequency (VHF) television stations and a 58 percent stake in United Television -- which owns the other three Christ-Craft VHF stations and its four ultra high frequency (UHF) stations.

The deal would give News Corp. a number of cities with two TV stations and 40.5 percent of the nation's television audience -- putting it over the U.S. Federal Communications Commission's current 35 percent cap.

News Corp. said it planned to divest some television stations to comply with FCC guidelines and to swap others to gain more cities with two television stations.

That duopoly strategy of having two stations in one city allows media owners to add the second station at virtually no cost and reap the additional revenue.

"For News Corp. it ends up being a great long-term move because they have access to creating all these duopolies in major markets,'' said Archana Basi, media analyst at T. Rowe Price, a shareholder of Chris-Craft and News Corp.

She said the deal may start to "make people aware of the duopoly potentials out there.''

"Chris-Craft was a unique asset, a great asset because of the markets it's in,'' she said. "There are other affiliate groups out there that a lot of the big networks may decide to buy and try to create duopoly situations like the one News Corp. is doing with Chris-Craft,'' she said.

Because of FCC rules, however, News Corp. said it would most likely swap the Chris-Craft TV station in Salt Lake City -- United Television's VHF station KTVX, an affiliate of Walt Disney Co.'s (DIS.N) ABC network -- for another station somewhere else.

News of the deal came after Viacom Inc.(VIA.N) abruptly announced Friday it had ended takeover talks with Chris-Craft.

"It's somewhat surprising that Viacom did not make this acquisition,'' Reif Cohen said. "But I think they will come out very well.'' Chris-Craft earlier this year sold its 50 percent stake in the UPN television network to Viacom, which owns the other half.

Although Viacom failed to win Chris-Craft, it avoided a costly bidding war and stands to gain by swapping some of its stations with News Corp as they each seek to comply with FCC regulations, Reif Cohen said.

"I think it might work out well for them,'' she said.

Under the agreement, News Corp. would pay $2.13 billion in cash and 73 million American Depositary Shares (ADRs), representing 292 million News Corp. preferred shares, for Chris-Craft, BHC, and United Television.

Each Chris-Craft share would be exchanged for $34 in cash and 1.1591 News Corp. preferred ADRs -- or, under the deal's guidelines, a Chris-Craft holder could opt to receive $85 in cash per share, or 1.9318 preferred ADRs, News Corp. said.

The agreement would swap $66 in cash and 2.2278 preferred News Corp. ADRs for each BHC share -- or, subject to limitations, either $165 in cash or 3.7131 preferred ADRs.

Each United Television share would be exchanged for $60 in cash and 2.0253 in preferred News Corp. ADRs -- or for $150 in cash, or 3.3755 preferred ADRS.

News Corp. said 40 percent of the consideration in each merger will be paid in cash and 60 percent in preferred ADRs.

Fox Entertainment would issue 122.2 million of its shares to News Corp., which would increase News Corp.'s stake in Fox



© , News Digital Media, Inc. d/b/a Fox News Online
All rights reserved. Fox News is a registered trademark of 20th Century Fox Film Corp.
Data from Thomson Financial Interactive is subject to the following Privacy Statement
© 2000 Reuters Ltd. All rights reserved