New World Agrees to Buyout by Murdoch’s News Corp.
LOS ANGELES (AP) _ The Fox network’s parent company has struck a $2.48 billion deal to buy 10 more TV stations and become the country’s biggest station owner.
Rupert Murdoch’s News Corp.‘s acquisition of New World Communications Group’s 10 Fox affiliates gives him a larger base and more control to launch and promote new shows. News Corp.’s Fox subsidiary would have 22 stations, including nine in the top 10 markets, reaching 40 percent of all homes.
The deal is subject to approval by stockholders of New World and by the Federal Communications Commission. It is expected to close early in 1997.
New World Chief Executive William C. Bevins called the offer ``an extremely attractive opportunity for our shareholders to realize the value which has been steadily accruing in New World.″
New World shareholders would get 1.45 shares of News Corp. preferred stock valued at about $27 a share for each New World share.
The transaction could jeopardize a reported move by New World to buy King World Productions, a television program producer and distributor.
New World, which is controlled by investor Ronald O. Perelman, had reportedly been on the verge this week of announcing its purchase of King World, in a deal valued at about $1.5 billion.
News Corp. had looked to purchase New World earlier this year, but the talks collapsed because the companies could not agree on a price. Perelman thought his company was worth $29 a share but Murdoch only wanted to pay about $24 a share, according to published accounts.
The talks ended in April and Perelman then reportedly began to discuss a merger with King World, which had been on the market for almost a year. King World, a powerful production syndicator, distributes the hit shows ``Jeopardy!″, ``Wheel of Fortune″ and ``The Oprah Winfrey Show.″
News Corp. already owned 20 percent of New World when the latest merger talks began. It acquired that stake two years ago for $500 million in exchange for New World switching 10 of its 12 television stations to a Fox affiliation from other networks.
That move set off a spectacular round of affiliation switches among television stations and left CBS racing to acquire new affiliates in major markets.