Word: turner
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Dates: during 1990-1999
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...courtship had all the frenzied twists of a Looney Tunes cartoon--or CNN's Gulf War coverage. For nearly a month, with the world looking on, Time Warner chairman Gerald Levin used shuttle diplomacy to pursue an $8 billion merger with Ted Turner's Turner Broadcasting. Spectators watched in bemusement as Time Warner acknowledged its courtship, then appeared to be stymied by cable-TV king John Malone, a Time Warner rival whose Turner stake gives him effective veto power over a deal. But by Sunday, as TIME went to press, Levin and Turner were tantalizingly close to sealing an agreement...
...deal, which would vault Time Warner ahead of the newly combined Walt Disney Co. and Capital Cities/ABC, raises questions ranging from how Levin, Turner, Malone and top Time Warner executives would co-exist to the impact on Time Warner shareholders. The buyout would lock the cerebral Levin into a potentially volatile alliance with the driven and charismatic Turner, who would own about 11% of Time Warner stock and become its vice chairman under the expected terms of the agreement. "In bringing Turner in, Jerry is rolling big dice," says a media-industry watcher. "He may continue to be chairman...
...make matters dicier, a merger would also bring Malone, the chairman of Tele-Communications Inc. and a man with a bent for elaborate corporate schemes, into Time Warner's fractious family. Malone, who stands to convert the 21% of Turner stock he controls into about a 9% stake in Time Warner, strung out the talks with a long and changing list of demands that threatened to block an agreement. "He asks for everything," says a Time Warner executive. "You never know when he's finished." Levin and Malone hashed out their main differences at a Sept. 9 meeting...
Sources close to the deal said Malone won concessions including a premium for at least some of his Turner stock, which Time Warner would acquire from other shareholders at the rate of three-quarters of a share of Time Warner for each share of Turner. It was expected that Malone would also receive "favorable terms" when purchasing programming such as CNN or Time Warner's HBO to run on his cable systems. But Time Warner refused to eliminate its poison-pill defense against takeovers, which kicks in when a shareholder acquires 15% or more of the company's stock...
...what about actual product? A big question remains as to how Levin would meld Turner franchises, ranging from CNN to New Line Cinema to the Atlanta Braves, into Time Warner's vast array of film, music, publishing and cable ventures. To land Turner Broadcasting, Levin has said it can run as a stand-alone company. Yet that could make it tough to integrate Turner into Time Warner to achieve cost savings--let alone synergy, the talismanic media-company goal that sounds so good and is often difficult to attain. On the other hand, Time Warner could distribute Bugs Bunny, Daffy...