Won’t Affect UA Deal, Chief Says : Tri-Star Confirms It Will Buy Loews Theater Chain

Tri-Star Pictures confirmed Monday that it has agreed to buy Loews Theatre Management Corp., the nation’s 13th-largest movie-house chain with 228 screens, but declined to disclose the price.

One executive involved in the deal said the price tag is “approximately” $300 million.

Victor A. Kaufman, Tri-Star’s chairman and chief executive, said negotiations “started very recently, within the last week or two.” He refuted industry speculation that the Loews deal might diminish Tri-Star’s desire to proceed with its announced plan to acquire the United Artists Communications chain for about $500 million.

“The UA deal is going forward,” Kaufman said.

If completed, the two acquisitions would make New York-based Tri-Star the largest motion picture theater operator in the nation, with 1,328 screens, eclipsing current industry leader General Cinema Corp.

Although the cost of purchasing the Loews chain will exceed Tri-Star’s unused bank credit line of $200 million, Kaufman said, “we are in the process of increasing that credit line as part of these transactions.”

Tri-Star, founded just four years ago as a joint venture of Columbia Pictures Industries, Time Inc. and CBS Inc., began trading shares publicly last year.

The Loews Theatre chain has more than doubled in value since it was acquired 15 months ago by Los Angeles businessman A. Jerrold Perenchio and other investors for $158 million. The Perenchio group already has sold some valuable real estate beneath Manhattan theaters for more than $40 million.

Perenchio’s investment in Loews will likely join the roster of other memorable deals negotiated by the 55-year-old businessman since leaving MCA in 1962, where he once worked as a talent agent. Perenchio built his own successful agency in the 1960s, then began a string of highly imaginative deals that netted publicity as well as profits.

Perenchio, for example, dreamed up the 1971 “Fight of Champions” boxing match between Muhammad Ali and Joe Frazier, which grossed more than $20 million. In 1977, he helped form a Los Angeles pay-TV operation called ON TV, selling his 49% stake four years later for $55 million, shortly before the “over-the-air” industry fell upon hard times.

In 1985, Perenchio and former business partner Norman Lear sold Embassy Communications for $485 million, which included Tandem Productions, a highly successful TV production company, and Embassy Pictures. Perenchio and Lear had acquired Embassy for about $25 million four years earlier.

The Loews theater chain was once part of a movie-making empire that included the Metro-Goldwyn Mayer studio in Culver City. But in 1959, the theater chain was spun off to end years of antitrust litigation with the federal government. At the time, the firm had 111 theaters in the United States and Canada.

Within six months of the spinoff, Laurence Tisch acquired 15% of the company, becoming its largest shareholder. Before 1960 ended, Tisch was elected chairman and chief executive and merged his family’s hotel operations into the chain. In 1985, Tisch sold the theater company to Perenchio’s investor group, which included the subsidiary’s president, Bernard Myerson, who had been with the company for 23 years.

In an interview last April, Tisch said: “It was an opportunity for (Myerson) to get a piece of the company, so it was a good deal for him, and it was a good deal for us, and it wasn’t that important a part of our earnings.”

Myerson could not be reached Monday for comment, but in past interviews, he has told The Times that he owns about a 17% stake.