Atlanta television entrepreneur Ted Turner acknowledged on Tuesday that he may have hit a serious roadblock in his protracted $5.4-billion hostile takeover bid of CBS Inc.
In his first public address since his April offer to buy CBS, Turner told a luncheon audience of the National Press Club that a new CBS counteroffer to buy back some of its outstanding stock has "changed everything" and could thwart his attempt to wrest control of the huge entertainment and media conglomerate.
CBS offered last week to pay $150 each for more than 20% of its outstanding shares. Such a move, Turner said, "would make it extremely difficult, if not impossible, for our offer to have any chance whatsoever."
Turner declined to comment on whether he would up his own non-cash offer to counter CBS.
There were few other hints at his well-attended luncheon speech, however, that Turner was concerned about his ability to carry out his bold effort to take over CBS. Asked what he would do if he failed, Turner quickly retorted: " 'If we fail' doesn't exist in my vocabulary."
The flamboyant owner of Cable News Network, superstation WTBS and the Atlanta Braves baseball team has maintained--what is for him--a very low profile since his April bid for CBS. His attorneys have continually persuaded him to refrain from public comments on the deal. With the filing of a prospectus last week, however, the muzzle came off and the so-called "mouth from the South" roared back in what at least one veteran Turner watcher labeled "vintage" form.
"There is no corporation in America that is as arrogant as CBS," Turner charged, answering one question from the floor. He said that he decided to go after CBS "because of its general arrogance."
" '60 Minutes' has done a hatchet job on just about everybody," Turner said, saying that one of the many changes that he would make at CBS would be "to increase the objectivity" of the highly rated news-magazine program.
Turner was especially critical of a recent Mike Wallace profile of former President Jimmy Carter that began, Turner said, by labeling Carter a "loser."
"How many elections has Mike Wallace stood for?" Turner asked. "When we take over CBS who's going to be the loser?"
Turner's presence in Washington was the highlight of two days of intense takeover interest in the capital.
Also on Tuesday, the Federal Communications Commission held a hearing on what role, if any, it should play in the hostile and friendly corporate takeovers that have affected media and communications companies in the last year. Today, the telecommunications subcommittee of the House Energy and Commerce Committee plans a morning of hearings on the subject.
The new corporate maneuvers have come since the FCC lifted a long-standing limit on the number of TV and radio stations that any one firm may own. Prior to Turner's announcement of his hostile CBS takeover attempt, the largest of these media transactions was the announced friendly $3.5-billion deal between New York-based Capital Cities Communications Inc. and American Broadcasting Cos. Inc.
Australian press magnate Rupert Murdoch is buying the Metromedia station group, including KTTV (Channel 11) in Los Angeles, and former Los Angeles Lakers and Forum owner Jack Kent Cooke is attempting to acquire the Multimedia chain of stations.
But the colorful Turner, who has made a career of bucking the established forces of American television, has garnered the most public interest with his effort to acquire CBS.
Much of that interest and concern has centered on what Turner would do to the critically acclaimed CBS News division, which has long claimed considerable independence from corporate control.
Turner criticized CBS News for failing to reflect the broad range of political points of view, but refrained from labeling it with the liberal bias that some critics have charged. He also said that he had no intention of firing anchorman Dan Rather.
(Rather and CBS' alleged liberal bias have been the targets of conservatives headed by North Carolina Republican Sen. Jesse Helms, who also had announced a desire to acquire CBS. Early on, there were reports of an alliance between Turner and Helms forces. Turner said that he hadn't talked with Helms in "quite a while.")
Turner reserved his most stinging criticism of network television for its entertainment programming. Repeating an oft-stated theme, Turner chastised all three networks for airing "too much violent programming, too much sleaze and not enough dealing with the important and critical issues of our time."
Asked for comment on the Turner speech, George Schweitzer, vice president of communications, CBS/Broadcast Group, said: "It was a very creative yet conveniently distorted interpretation of the facts."
Since announcing his plan to acquire CBS, Turner has been involved in a heated and, at times, nasty legal and financial battle with the New York-based corporation. Turner's $175-a-share bid for CBS is based largely on so-called "junk bonds," which will be used to pay off shareholders after Turner liquidates some of CBS' non-broadcast holdings. Turner estimated that he already has spent about $15 million on the CBS takeover effort.
Since spring, CBS has defended itself with a series of novel financial "poison pills," as Turner called the network's efforts to thwart him.
"Every day I wake up like everybody else and wonder what they're going to do next," Turner said.
Last week, CBS combined its stock buy-back offer with a call for the Federal Communications Commission to hold lengthy hearings on the Turner bid and a successful lobbying effort with the New York legislature for a bill severely restricting cashless takeover efforts such as Turner's.
"We hope that Gov. (Mario) Cuomo will veto (the new bill)," Turner said. "If he doesn't, then we'll have to take it to court."
Turner said that CBS' string of anti-takeover efforts marked a "blatant disregard by the CBS board of directors of their fiduciary obligations" and "usurped the rights of shareholders" to determine for themselves whether the Turner bid should be accepted.
The Turner-CBS fight also has been characterized by "poison pills" of a less traditional sort. CBS Chairman Thomas H. Wyman and other CBS executives have accused Turner of lacking the necessary "conscience" and not being "moral enough" to own a major network.
"In light of a number of pejorative statements by Mr. Turner about various minority, religious and ethnic groups," wrote the directors of the company that calls itself the "Tiffany's" of commercial TV in a May letter to shareholders, "we believe that (Turner's) acquisition of CBS would undermine the CBS network's present broad acceptance by the American public."
In answer to a question, Turner flatly denied that he is a bigot and said that he didn't "have anything against" Wyman. "Before he made that statement, I liked him," Turner said of the CBS chairman.
Others have joined the chorus attacking Turner, most notably former Cable News Network and CBS News correspondent Daniel Schorr who wrote in an opinion article for The Times that Turner harbored anti-Semitic prejudices and often attempted to influence the content of news programs.
In a letter to The Times, Turner denied Schorr's charges and dismissed them as the comments of a disgruntled former employee.