Way Cleared for Turner’s MGM Deal
Turner Broadcasting System cleared the way Monday for a mid-March closing of its $1.25-billion acquisition of MGM/UA Entertainment Co.
Led by 80%-shareholder Ted Turner, the cable and satellite television broadcasting firm formally voted approval of the deal in a special stockholders meeting in Atlanta. MGM/UA shareholders approved the merger in a rare night session Monday at its Culver City headquarters.
The outcome of the MGM/UA session, like the one in Atlanta, was foreordained because Ted Turner held a proxy to vote the 50.1% majority holding in the movie company from financier Kirk Kerkorian.
Kerkorian, who has controlled the historic studio for the last 15 years, is buying its United Artists subsidiary for about $480 million. Both deals are to close simultaneously.
After his company’s meeting earlier in the day, Turner said negotiations on the possible sale of any or all of MGM’s assets except for its big film library would not resume until after the merger is completed.
Noting that the acquisition will strengthen his company’s position in the television and entertainment business, Turner said: “This was what we really wanted. This really strengthens us dramatically. I wouldn’t trade our position with any other company in the business.”
Turner Broadcasting owns Cable News Network, CNN Headline News, Atlanta “superstation” WTBS and two professional sports teams, the baseball Atlanta Braves and the basketball Atlanta Hawks.
Under the proposed merger, MGM/UA shareholders will receive $20 cash and one share of a new Turner preferred stock for each share of MGM/UA stock.