Murdoch Loses--MGM-UA Accepts Qintex Bid
MGM-UA Communications Corp. today accepted a $1.5-billion buyout offer from Australia’s Qintex Group today, a sweetened bid that topped a $1.4-billion offer from media mogul Rupert Murdoch.
Qintex, which also will assume $400 million in MGM-UA junk bond debt, increased its offer to $25 per share of common stock, up from $20. Murdoch’s News Corp. Ltd. and its Fox Inc. unit had offered $23.16 a share and had negotiated with MGM-UA’s board until late Thursday.
Qintex sealed its bid with a promise to “promptly” make a non-refundable $50-million deposit on MGM-UA, the company that combines what remains of the old United Artists and MGM movie studios.
Qintex, which operates resorts and an Australian TV network, also owns 43% of Qintex Entertainment, the Los Angeles-based producer of television movies and miniseries, including “Lonesome Dove.”
In addition to the 20th Century Fox studio, Murdoch’s newspaper, magazine and television enterprises on four continents are said to be worth more than $8 billion. He had his eye on MGM-UA’s huge library of films, which he could have used for his new Sky Television satellite operation in Britain.
His spokesman, Howard Rubinstein, said MGM-UA had approached him about a buyout.
“He thought he had a deal, but then the transaction fell apart,” Rubinstein said. He declined further comment.
MGM-UA had spent 18 months trying to find a buyer satisfactory to Kirk Kerkorian, the Los Angeles billionaire who owns 82% of MGM-UA, and who had repeatedly sold, then repurchased many of the assets of the old MGM and United Artists studios.
The previous deal proposed by Qintex would have in essence split MGM-UA, with Qintex paying about $600 million for the United Artists studio and some other assets. It would have given Kerkorian the famous lion logo, the MGM TV operations, a library of 34 recent movies and the MGM-UA headquarters building in Beverly Hills.
MGM Grand Inc., a Kerkorian-controlled company that operates a first-class airline and Nevada casinos, will buy back the MGM-UA headquarters building from Qintex in October for $43 million or its independently appraised value. MGM-UA will make about $26 million on that deal, the company said.
