Warner Communications Inc. said today that it has completed its long-delayed $1.2-billion merger with Lorimar-Telepictures Corp. in the wake of Lorimar's sale of the last of its television stations.
The merger of the two entertainment concerns had been delayed since last fall because of a court ruling that prohibited Warner from proceeding with the deal until Lorimar sold its television stations.
On Tuesday, Lorimar completed the sale of the last of its stations, WPGH in Pittsburgh.
Under terms of the merger agreement, Lorimar becomes a wholly owned subsidiary of Warner, and each share of Lorimar stock has been converted into the right to receive .3675 of a share on Warner stock.
Lorimar had about 46 million shares of common stock outstanding as of last October, which could be converted into about 17 million shares of Warner stock. At Warner's closing price of $37.12 1/2 a share on Tuesday, the swap would be worth about $630 million.
In addition, Warner would assume Lorimar's debt of about $600 million, boosting the effective value of the transaction to about $1.2 billion.