CBS Still Negotiating With Sony on Record Unit Sale

Contradicting published reports that CBS Inc. has agreed to sell its record division to Sony Corp. for $2 billion, a CBS spokeswoman said Wednesday that no decision on the sale has been made and that no agreement was presented to directors at their regular monthly board meeting Wednesday.

Negotiations with Sony “are still continuing, and no agreement has been reached yet,” said Alice Henderson, CBS’ vice president of communications and information.

Following the two companies’ confirmation late last month that they were engaged in “serious discussions,” speculation in the record industry and on Wall Street was that the deal would be approved by the CBS board at its November meeting. However, Henderson said Wednesday that “there was nothing to present to the board to vote on one way or the other.”

According to one source, who asked not to be identified, “the deal fell apart at the last minute, but they’ve now put it back together again.” However, he said, “they’re still haggling over which parts of the company will be included--whether the CBS record club operations will be part of the sale--and who’s going to get the revenues for this big fourth quarter.”

The board’s next regularly scheduled meeting is Dec. 9, but a special meeting could be called at any time.

Despite the last-minute snags, industry experts believe that an announcement of the sale is only days--if not hours--away. “This is as done a deal as you can get,” one former CBS officer said. “What’s happening is that Sony is insisting that all due diligence be completed before a contract is signed, which is unusual in these cases, but it’s the way Sony does business.”

According to the former officer, CBS and Sony lawyers have been working “around the clock, and they are moving very fast to get everything done.” The lawyers are going over hundreds of contracts with CBS recording artists and executives, he said.