QVC Firms Up Bid for Paramount : Business: Home shopping network says it has secured solid financing for its attempt at the hostile takeover.

QVC Network Inc. said Saturday that it had secured solid financing for its hostile bid to acquire Paramount Communications Inc.

The announcement by QVC, a home shopping network headed by Barry Diller, undermines a recommendation from Paramount’s board of directors last week that shareholders reject the offer in part because QVC lacked firm financial backing.

QVC’s offer for Paramount is valued at $10.5 billion, about half of it in stock and the rest in cash. The cash portion previously depended on conditional financing.

On Saturday, however, QVC said one of its backers, BellSouth Corp., agreed to purchase $1.5 billion in QVC stock to provide some of the cash. The phone company had previously pledged that sum in a “non-binding” memorandum of understanding with QVC.

QVC also said it had paid the necessary commitment fees to a consortium of six banks that previously had agreed to lend $3 billion to QVC to finance a merger with Paramount. QVC all along had solid commitments of $500 million each from Advance Communications, Cox Enterprises and Comcast Corp.

The new commitments constitute all the funding required for QVC’s tender offer, the company said. QVC also extended the offer by three days, to midnight Nov. 29.

QVC, which is offering $90 a share for 51% of Paramount, is competing for the studio against Viacom Inc., which is offering $85 a share for 51% of the entertainment and publishing firm.

Viacom’s offer is set to expire at midnight Monday. QVC has argued that Paramount’s board has not adequately considered its offer, valued at nearly $1 billion more than Viacom’s.

QVC’s announcement comes as QVC awaits a Delaware court decision on a lawsuit it filed seeking to invalidate Paramount’s “poison pill” provision, which could make a takeover prohibitively expensive by flooding the market with new shares. QVC also wants the court to scrap Paramount’s “lockup” agreements with Viacom, which add more than $700 million to QVC’s acquisition costs. A ruling is expected Monday.

Paramount last week defended in court its rejection of QVC’s unsolicited bid partly by arguing that it was contingent on financing. The firm also argued that Viacom would be a better strategic fit.

Viacom and Paramount declined comment Saturday.

In a letter to Paramount’s board Friday, Diller said he was surprised to learn that Paramount’s board had rejected QVC’s Nov. 12 offer “largely on the basis that our offer was supposedly ‘highly conditional.’ ” Diller said that with Saturday’s financing commitments, “QVC’s offer is fully financed.”