Columbia Deal With Embassy Reported Near : Industry Sources Talk of $250-Million Price Tag

Is Columbia Pictures Industries about to buy Embassy Communications, a much smaller movie and television production company?

New York-based Columbia Pictures, a unit of Coca-Cola, and Los Angeles-based Embassy have avoided comment on published reports and persistent entertainment industry talk that Columbia will buy the bulk of Embassy’s assets.

But entertainment industry sources said Wednesday that it is widely believed that such a deal is now a virtual certainty. The sources said $250 million is the frequently mentioned price tag for Embassy, owned by television producer Norman Lear and entrepreneur A. Jerold Perenchio.

Perenchio, according to reports, has been negotiating with officials of Atlanta-based Coca-Cola. But a Coca-Cola spokesman referred calls to Columbia’s New York headquarters.

There, a spokesman reiterated his statement of earlier this week that the company “does not confirm, deny or comment on matters of rumor, speculation or litigation” as a matter of policy.

Diverging Interests

A sale of Embassy Communications would spell the breakup of a business combine formed in December, 1981, by longtime business partners Perenchio and Lear. The interests of the two have diverged increasingly of late, sources say, although there is no indication of personal differences between them.

Perenchio--without Lear--two months ago was negotiating with Loews Corp. to acquire its major chain of movie theaters for a reported $165 million. Loews confirmed that a proposed transaction was agreed to in early April and recently indicated that a deal might be completed by June 30.

Embassy Pictures, without saying anything directly about the reported negotiations for a Columbia buy-out, did confirm a report Wednesday in the trade publication Daily Variety that Joe Sugar, its executive vice president-sales, met this week with Columbia’s distribution chief, James Spitz, to discuss Embassy’s new film, “The Emerald Forest.”

Sugar and Martin Rabinovitch, senior vice president-marketing, said in an Embassy news release Wednesday that plans for John Boorman’s “The Emerald Forest” “are proceeding ahead as scheduled for a July 3 national release.”

Will Distribute Film

“Because of the various rumors which have been circulating within the industry the last few days, I felt it necessary to make a formal announcement that Embassy Pictures will in fact distribute the film, as has been previously planned.”

An Embassy spokesman, Ed Russell, said the discussions between Spitz and Sugar were held “at Embassy’s request to discuss strictly the release of ‘The Emerald Forest.’ ”

Russell said the meetings were “not to clear anything” with Columbia.

At Columbia’s studio in Burbank, Spitz could not be reached for questions. A reporter was referred to Bob Dingillian, vice president-domestic distribution and marketing, who said he could not comment.

As for the reports of sale negotiations between Embassy and Columbia, Embassy’s Russell said: “We can’t comment on any of that. It would be premature.”

Embassy’s most successful operations involve television production, distribution and syndication. Its shows include “The Jeffersons,” “Alice,” “Diff’rent Strokes,” “Silver Spoons,” “Double Trouble,” “It’s Your Move” and “E/R.”

When Lear and Perenchio formed Embassy Communications several years ago, it combined T.A.T. Communications (“The Jeffersons” and “Facts of Life” television series) and Avco Embassy Pictures, which they bought for $25 million.

Also included in the entertainment conglomerate at that time was management of Lear’s and Bud Yorkin’s Tandem Productions (“Archie Bunker’s Place” and other TV series) and some 50 cable-TV systems.

Embassy Pictures, which has raised more than $125 million by selling limited partnership interests to produce and market feature films, is co-producing the stage hit, “A Chorus Line” with Polygram.