MCA, Matsushita Officials to Begin Acquisition Talks

Top executives of MCA Inc. and Japan’s Matsushita Electric Industrial Co. will meet in face-to-face bargaining here next weekend as acquisition talks between the companies head into what appears to be the home stretch.

Both Matsushita President Akio Tanii and MCA Chairman Lew R. Wasserman are expected to attend the sessions, individuals familiar with the talks said. Company officials have exchanged financial information since word of Matsushita’s plan to acquire MCA for as much as $8 billion surfaced in late September. But the chief executives have not negotiated directly.

Creative Artists Agency Chairman Michael Ovitz, Matsushita’s chief representative in the talks, is also headed to New York for the discussions, sources close to the deal said.

One knowledgeable source predicted that the acquisition “will be done by the end of November,” but it remained unclear whether the companies were close to an agreement on price and other key points.

Both companies formally declined comment on the talks.

MCA executives have said the company hopes to get more than $80 a share from Matsushita and to boost the payout to stockholders as high as $90 per share by separately selling the company’s New York-area WWOR television station to a buyer such as Chris-Craft Industries or Walt Disney Co., which are both said to be interested.

But reports from Japan have suggested that Matsushita executives expect to pay closer to $70 a share for MCA. MCA stock closed Tuesday at $62.50, up 75 cents, in New York Stock Exchange composite trading.

According to several sources, the MCA contingent in the bargaining sessions will include Wasserman, President Sidney J. Sheinberg, Executive Vice President Charles S. Paul and company officials George Smith and Robert D. Hadl.

Matsushita is expected to send both Tanii and his top lieutenant, Masahiko Hirata, an executive vice president. It wasn’t clear where the talks would be held. But one source said the first session was likely to occur on Sunday.

MCA is represented by the investment banking firm Lazard Freres & Co. and the law firm of Wachtell, Lipton, Rosen & Katz. Matsushita has been represented by Ovitz and investment banker Herbert Allen of Allen & Co.

Entertainment industry analysts said confidence in the deal is growing. Paul C. Marsh of the Los Angeles investment firm Bateman Eichler, Hill Richards said the stock has traded about as high as it can go without a deal actually being announced.

“They’ve traded it to the limit,” Marsh said. “There certainly is a strong feeling that there is going to be a deal.”

Michael Cieply reported from New York and Alan Citron from Los Angeles.

MCA Edges Higher Tuesday: $62.50, up 75 cents Source: Knight-Ridder Trade Center