Takeover Spotlight Is Now Shining on CBS

And then there was one?

With NBC and ABC getting new owners, CBS attracted a flurry of stock trading Thursday as the sole remaining major TV network that has not changed hands this year. The shares traded as high as $117.25 before closing at $114.25, up $1.325 from the previous day.

But analysts are divided on the question of whether CBS is truly ripe for a merger. Loews Corp. recently accumulated 11.9% of the broadcaster’s stock, and Loews Chairman Laurence A. Tisch joined the CBS board after a friendly invitation.

Wall Street sources portray Tisch as a shrewd, patient investor who has acquired enough stock to influence the company’s management and direction. While these sources also predict that Loews would sell its stake if a lucrative cash offer materialized for the entire company, they note that few corporations could pay cash, as General Electric proposes for RCA.

An unfriendly takeover of CBS would be even more difficult to mount after the passage this week of a New York legislative bill that imposes a five-year ban on a hostile takeover by anyone who accumulates more than 20% of the target company’s stock without permission of the company’s board. Gov. Mario Cuomo has said he will sign the bill, and CBS will presumably enjoy its protection because it is incorporated in New York.

The GE-RCA merger, announced Wednesday night, set off active trading in several other broadcasting and entertainment companies in addition to CBS.

Los Angeles-based MCA, which reportedly held merger talks with RCA earlier this year, dropped $2.25 on a volume of 1.2 million shares on the New York Stock Exchange to close at $49.125.

“All the arbitrageurs . . . bailed out this morning,” one investment banker said. (On average, MCA shares have traded at a daily volume of 305,000 shares this year.)

Taft Broadcasting shares traded actively for a second day, closing up 75 cents at $82 on a volume of 60,000 shares. The Cincinnati-based company has been the object of speculation since a group led by Robert M. Bass of Fort Worth disclosed that it has had an 8% stake last July. The Bass group’s stake has since been increased to 11%.

Viacom International, another broadcasting and entertainment concern that attracted heavy trading last month on takeover rumors, closed at $58.625, up $1.75, on a volume of 374,800. Like CBS and Taft, Viacom has also attracted an investor group--led by JMB Realty executives of Chicago--that holds slightly more than 11%.

One investment banker, noting the similar 11% stakes, said only half-jokingly: “It’s a nice number. It’s a lucky number.”