Related topics

CBS Discloses Inquiry From Sony About Record Division

September 12, 1987

NEW YORK (AP) _ CBS Inc. said Friday it is considering a second approach from Sony Corp. about buying CBS’s records division.

Analysts speculated that the records unit, which has been highly profitable in recent months, would be sold if the price were high enough. They said it could attract a bid of as much as $2 billion.

On the New York Stock Exchange, CBS stock climbed $9.50 a share to $208.50 Friday, on top of an $8.12 1/2 jump Thursday.

CBS issued a brief statement at midday in reponse to inquiries about a report in The Wall Street Journal that the CBS board was expected to meet as early as next week on whether to sell part or all of its records division.

The newspaper report said the board decided to meet because of a new overture from Sony, which reportedly offered to buy the records division last year for $1.25 billion but was rebuffed along with several other bidders.

In its statement, CBS said it ″had received an inquiry from the Sony Corp. soliciting CBS’s interest in discussing a possible sale of all or a part of the CBS Records Group.″

″No negotiations are now under way to sell all or a part of the CBS Records Group. CBS will consider and respond to Sony’s inquiry in due course,″ the statement said.

Alice Henderson, a CBS spokeswoman, said she could not elaborate on the statement. She said she did not know if a board meeting had been scheduled.

Jason Farrow, a spokesman for Sony Corp. of America, the U.S. subsidairy of the Japanese consumer electronics giant, declined comment.

Peter Appert, a media analyst for the investment firm C.J. Lawrence in New York, said, ″My bet is that the records company is going to be sold.″

He noted that under Laurence Tisch, who took over a year ago as CBS president and chief executive, CBS has sold a number of non-broadcast assets.

It has agreed to sell its magazine division and sold its book and music publishing units. Tisch reportedly favors selling the records division because of the volatility of the record business.

Appert said CBS could get ″something approaching $2 billion″ for the records company. Another media analyst, Mark Riely of Eberstadt Fleming, said the records division could command between $1.6 billion and $2 billion.

But Riely said selling the records division, which is one of CBS’s core businesses, might be resisted by some members of the CBS board, including CBS Chairman William Paley.

″The records business is dearer to Paley’s heart than the magazines or publishing ever were,″ he said.

Update hourly