MCA Stock Surges Amid Concern for Chairman’s Health

Shares of entertainment conglomerate MCA surged in heavy trading Friday as reports circulated that long-time Chairman and Chief Executive Lew R. Wasserman underwent a second operation this week at Cedars-Sinai Medical Center in Los Angeles.

Analysts said Wall Street investors were reacting to concern that the health of Wasserman, 73, could make the giant parent of Universal Studios more vulnerable to a corporate takeover.

MCA stock, which rose as high as $55.50 a share during trading Friday on the New York Stock Exchange, closed at $52.75, up $4.875 from Thursday, as 2.8 million shares changed hands, making it the Big Board’s fifth-most active issue. The price fell back slightly after the Los Angeles-based company issued a statement saying that Wasserman was “recovering satisfactorily” from what it described as “recent surgery.”

As previously reported, Wasserman was hospitalized June 24 at Cedars-Sinai for what was then called routine surgery to remove polyps from his colon. After that operation, he was said to be in good condition, but he was not released from the hospital.

A Cedars-Sinai spokesman Friday described Wasserman’s condition as “fair,” saying that the movie-TV executive remains in the intensive-care unit. The spokesman added, however, that Wasserman “is really doing well.” Neither the hospital spokesman nor MCA would confirm that another operation was performed this week.

But one source familiar with Wasserman’s condition said the MCA chairman was rushed into surgery Thursday because of unexpected bleeding. The bleeding was found to have come from torn muscle and didn’t reflect any serious complication in Wasserman’s health, the source said.

Mara Balsbaugh, a securities analyst with the Smith Barney, Harris Upham investment firm in New York, attributed Friday’s stock action to Wall Street’s “perception” that MCA would be more vulnerable to corporate raiders if Wasserman died or sold his large stake in the company.

Wasserman is considered one of the last movie “moguls.” He helped build MCA 50 years ago together with its late founder Jules Stein, and he controls about 15.3% of its 76 million common shares through direct ownership and various trust arrangements.

MCA President Sidney J. Sheinberg declined to comment Friday on Wasserman’s health or on the movement in MCA stock.