Here are a few excerpts from an article in the current issue of Electronic Media that I thought you would find interesting... [any typos mine] p. 27, by Diane MermigasRadio stations owned by Infinity Broadcasting, the radio giant controlled by Viacom, could soon provide platforms for VH1 and MTV branded preograming, now limited to cable TV--and carry "informercials promotioning recent home-video releases at Viacom's Blockbuster stores.That's the word from some analysts, though Infinity and Viacom executives are cautions about showing their hand....Infinity's senior VP and CFO said in a rare interview...Infinity, CBS and Viacom have barely started to realize "the real benefits of consolidation,...Industry analysts consider Infinity one of the most powerful cash flow machines in USA media, and it's clear that the company is fixed on taking radio consolidation and cross-media expansion to the next level.It also is likely that Viacom will soon bring Infinity back into the corporate fold by buying back shares of the company. Analysts say Infinity's stock, which has declined about 3 percent this year along with other broadcating issues, and Viacom's stock, which has risen about 75% this year make the timing right for such a move. Infinity stock is up about 60 percent since CBS sold 18 percent of the company to the public.We've unlocked the shareholder value. Viacom has a very shareholder friendly team at the top," Mr. Suleman [the CFO] said.Viacom, whose stock is trading at $67 a share, could use Infinity's projected $2 billion in 2001 cash flow to finance its long anticipated acquisition of Chris-Craft Industries $2.5 billion major market TV station group...We believe Viacom would acquire Infininty at no less than $42 a share. Thazt may take Viacom's Class B shares to $80, Mr. Hatch [of SG Cowen] told clients in a recent note. "Given the momentum and the free cash flow at Viacom, that may not take long."
In the "for what it's worth department"... From the EM story...Viacom, whose stock is trading at $67 a share, could use Infinity's projected $2 billion in 2001 cash flow to finance its long anticipated acquisition of Chris-Craft Industries $2.5 billion major market TV station group...News Company (Fox) made a bid for Chris-Craft's TV stations today, in the neighborhood of $5 billion if I recall the story correctly.Worth noting that there's bad blood between Viacom and Chris-Craft, who were joint owners of UPN, and which had a mutual "buy-sell" agreement. After 10's of millions of dollars in losses, Chris-Craft was forced to sell its half for something like $5 million, went to court over the deal, lost, end of game.Meanwhile, they're not likely to sell their TV station group to Viacom unless there is no other bidder around, and apparently there is.
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