BET Holdings bid is raised to $378 million Johnson and Liberty seek to take it private

Media

March 17, 1998|By BLOOMBERG NEWS

WASHINGTON -- BET Holdings Inc. founder Robert Johnson and Liberty Media Corp. agreed yesterday to pay $378 million, or $63 a share, for the part of the cable-television company they don't already own, raising an initial bid by almost a third.

The parent of Black Entertainment Television will become a privately held company controlled by Johnson and Liberty, who already had more than 90 percent voting control. Johnson also is BET's chairman and chief executive.

Black Entertainment Television is the largest remaining independent cable channel, reaching 50 million viewers.

An initial offer in September of $288 million, or $48 a share, prompted lawsuits from holders who claimed that Johnson was trying to get control of the company too cheaply. The new offer is 31 percent higher than the original bid.

"This is a fair price and a great price for shareholders," said Vincent Cappucci, a New York attorney representing some shareholders.

BET shares rose $6.0625 to $60.5625 yesterday.

For Johnson, the move means that he won't have to answer to shareholders about his costly attempt to move BET into areas other than the cable business.

"There was concern by shareholders that the new ventures weren't going to generate returns on par with the core cable channel," said David Doft, an analyst with Furman Selz LLC.

BET President and Chief Operating Officer Debra Lee said the company's board believes that the latest offer is in the best interests of holders.

The offer came after a special committee of one board member, National Public Radio chief executive Delano Lewis, determined that the first bid was too low and began to negotiate with Johnson. Goldman, Sachs & Co. represented Washington-based BET in the talks.

Johnson and Liberty Media own about 64 percent of the company's Class A shares but have 90 percent of the voting power through nonpublic Class B shares.

Liberty Media, the programming arm of Tele-Communications Group Inc., has said it acted to support Johnson because of his 20-year relationship with the cable company. Johnson has declined to comment.

BET is trying to reach more black customers with projects such )) as restaurants and a proposed casino in Las Vegas, as well as a foray into financial services.

BET went pbulic in 19091 at $17 a share adn was the first black-controlled company on the New York Stock Exchange.

Pub Date: 3/17/98

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