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Saban: A $6B dream

Is Fox Family Worldwide worth $6 billion? Probably not, but that's the price Haim Saban was throwing around even before negotiations began between him and Fox Broadcasting to buy him out.

Saban, chairman and chief executive officer of Fox Family, last month exercised his right, known as a put option, to require News Corp.'s Fox to buy out his 49.5% stake in Fox Family. Terms require News Corp. to pay cash.

News Corp. was notified Dec. 21 of Saban's decision, but had hoped to talk him out of it. Saban already agreed to extend once.

Rupert Murdoch's News Corp. already has one big acquisition to digest-Chris-Craft, for $5.4 billion. And it's considering a far bigger one: DirecTV parent Hughes Electronics, expected to go for more than $40 billion.

Now Saban and Fox have to come to terms on a price for Fox Family. Saban believes Fox Family Worldwide is worth $6 billion. After $2 billion in debt is subtracted, Saban's stake would be about $2 billion. According to the terms of their agreement, both sides have hired investment bankers to come up with formal valuations of the company.

Saban has hired Morgan Stanley; News Corp. has hired Bear Stearns. They have until Jan. 31 to come up with valuations. If the numbers are within 10% of each other, the average of the two will be taken. If not, another banker will be hired to come up with a third valuation.

Fox sources weren't offering estimates last week on what they think the value of Fox Family is, but one insider said it wouldn't be a great surprise if a third banker, or even fourth, is eventually called in.

Sources say Fox is looking for a new partner. Currently, Saban and Fox own 49.5% of Fox Family, while Allen & Co. owns 1%.