Word: viacom
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...outcome. With his latest parry -- even if it turns out to be as ineffectual as Diller thinks it is -- Redstone has for the moment denied QVC's chairman the prize he so eagerly desires. Diller, Redstone and Paramount CEO Martin Davis have been locked in combat since September, when Viacom agreed to buy the movie studio for $8.2 billion in a friendly deal. Soon after that agreement, Diller launched a $9.5 billion hostile takeover. In the bidding skirmishes that followed, both sides raised the stakes with the help of investment partners. QVC received backing from cable companies Comcast Corp...
After the surprising events of last week, the lingering question is why Viacom bothered to put such an offer on the table at all. One possible answer is that Redstone and his advisers believe that shareholders will not only appreciate the larger cash component of their offering but will also be swayed by future profit possibilities. Some analysts maintain that Redstone's combination will indeed offer far more synergy than QVC and Paramount. Says Chris Dixon, an analyst at Paine Webber: "It's hard to imagine what business opportunities exist between QVC and Paramount that can match Viacom, Blockbuster...
...seems as though the end is in sight. While he stopped short of declaring outright victory for the home- shopping channel, "Diller will not lose any sleep over this new bid," says analyst Logsdon. If Diller does not alter his own bid (most observers believe he will not) and Viacom fails to sweeten its package by early next week, then it remains for Paramount's shareholders to vote with their shares of stock. Though QVC and its advisers radiated confidence at the end of last week, they were not above taking out a little insurance, hinting that they may challenge...
...that is true, if Viacom has labored mightily to produce a bid that is not even as strong as its own last bid, then Redstone has made a massive miscalculation. In any case, it seems that the battle is close to being decided by the people who are supposed to make such decisions in the first place: Paramount's shareholders...
CAPTION: WHAT VIACOM HOPES THE DEAL WILL...