Redstone balks at Fox Family bidding
Despite the scarcity of cable networks for sale, Viacom Chairman Sumner Redstone is not particularly interested in joining the bidding for Fox Family Worldwide.
Chatting before his acceptance of an award for international cable players given by Multichannel News Internatioal, Redstone would not specifically say whether he planned to bid for FFW and its Fox Family Channel. But he emphasized that "we buy things that make money" and that FFW's operations might be too weak.
Redstone also reitereated his long-held stance that Viacom didn't need to make any major Internet acquisitions, such as Yahoo!. "We already have great content in Nicelodeon and MTVi," he said.
FFW 49% owner Saban Entertainment has triggered a clause in its partnership agreement to force partner Fox Entertainment to buy it out. But Fox Entertainment parent News Corp. is itself scrounging for cash to make a bid for Huges Electronics and its DirecTv DBS unit. While in other times, News Corp. would probably be buying Saban out, today the company has decided to try and sell the whole company for around $6 billion.
In the year-long dance between Saban and Fox, pieces of FFW have been shopped to just about every media player, including Viacom, The Walt Disney Co., and NBC. Viacom is in a fairly acquisitive mood, with company executives saying that Redstone is looking to take advantage of a recession-induced slide in value. But FFW is a tough sell, with ratings trouble on both its cable and broadcast syndication operations and without the high-profile programming of a Nickelodeon.
But Wall Street executives believe that FFW is simply too duplicative of Viacom's exising opeations. Viacom already dominates the kids TV business with Nickelodeon and is in the midst of overhauling TNN as a general entertainment network. "He already owns a Fox Family," said one investment banker of Redstone. "He just owns a better one that won't cost him $6 billion." - John Higgins
Disney and NBC don't have general entertainment networks in their portfolios and are seen as more interested.
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