CBS Expects $2.8 Billion From Infinity IPO

CBS Corp.’s Infinity Broadcasting Corp., one of the largest U.S. radio and billboard companies, said it plans to sell 135 million Class A common shares for between $19 and $22 each in its initial public offering. At the $20.50 midpoint of the expected price range, Infinity would raise $2.8 billion before expenses, according to its filing with the Securities and Exchange Commission. The New York-based company, with 835 million shares to be outstanding after the IPO, would have an implied market value of $17.1 billion at the $20.50 price. The company owns 161 radio stations that account for 11% of all U.S. radio advertising revenue, according to its filing. CBS will own the 84% of Infinity not being sold in the IPO, with 700 million Class B common shares. New York-based CBS bought Infinity for $3.8 billion two years ago from Mel Karmazin--now chairman and chief executive of Infinity and about to become CEO of CBS as well. At $20.50 a share, CBS’ stake would be worth about $14.4 billion, or more than 3 1/2 times what the TV network company paid. Most of the money Infinity is raising in the stock sale will go to CBS as well as to pay a $2.5-billion promissory note issued as a dividend to CBS, according to Infinity’s SEC filing. CBS shares fell $1.06 to close at $26.88 on the New York Stock Exchange.