Word: mergers
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Dates: during 1980-1989
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...largely because Siegel disapproves of the way Warner spends money on generous executive compensation (for Ross alone in 1987: $4.5 million in salary and bonus) and corporate amenities like the six-bedroom Acapulco villa for entertaining movie stars. Siegel also apparently believes that Warner is being undervalued in the merger agreement. When the proposed deal came up before Warner's board for a vote, Siegel abstained, while all the other members approved. Time and Warner officials, who are trying to convince Siegel of the merger's merits, admit that he could take legal steps to delay the transaction, but they...
...approved by Time and Warner shareholders, the merger would create a company that will have annual revenues of more than $10 billion and a market value of $18 billion. It would combine Time's magazines and its hardcover-book publishing, its cable programming and its cable-TV operations with Warner's movie, TV and video production, music labels, cable systems, paperbacks and comic books. The new company would include not only Time's stable of talented journalists, spread over two dozen magazines, but also Warner's Mad magazine, Superman comics and such recording artists as Madonna and U2. The businesses...
...over Macmillan publishers; Japan's Sony acquired CBS Records; and Australian-born Murdoch (now a U.S. citizen) accumulated newspapers, magazines, a movie studio and a TV network. Said Time's Munro: "We see Maxwell, Murdoch, Bertelsmann and Sony coming into our market and raising hell, and we see this ((merger)) as an opportunity for an American company to get competitive." In fact, Time Warner would vault ahead of the competition. Bertelsmann, whose annual revenues are nearly $7 billion, would fall to the No. 2 spot among the world's media companies...
...with any large merger, the Time-Warner deal will be reviewed by the Government to see if it poses any antitrust or other regulatory problems. The only major overlap between the two companies is that they are both big operators of local cable-TV systems. After the merger, Time Warner will serve 5.6 million customers, or 12% of U.S. households with cable. The new operation will still be smaller than the largest cable company, Tele-Communications, which serves 24% of the industry's customers. Experts say that unless President Bush takes a tougher antitrust stance than the Reagan Administration...
Nonetheless, Ohio Democrat Howard Metzenbaum, chairman of the Senate antitrust subcommittee and a vocal critic of big mergers, immediately objected to the proposed combination. He acknowledged that the deal did not appear to violate the Government's guidelines for "horizontal concentration" within an industry, but asserted that those "guidelines are clearly inadequate for a complete evaluation of this merger." The Senator expressed concern about companies being involved in both the production and distribution of cable-TV programming. Metzenbaum noted that in most communities there is only one cable operator. He fears that such operators might rely too heavily on programs...