CBS frowning at suitors, but it may need a `knight'

Although financier Ivan F. Boesky owns the biggest stake in CBS, and Atlanta broadcasting czar Ted Turner appears to have an interest in acquiring the network, most Wall Street analysts agree CBS will survive a tug of war for control of the company. But just how CBS will survive is a matter of opinion.

Some analysts contend it may have to find a ``white knight'' to save it. One possibility is General Electric, which could allow a certain degree of corporate autonomy to the broadcasting giant but would be powerful enough to keep other suitors at bay. Other analysts think CBS can hang tough in a battle for corporate control.

Joseph Barthel, director of equity strategy for the Philadelphia-based Butcher & Singer brokerage, thinks it likely CBS's current status will change -- probably through a merger with a protector such as GE.

But George C. Strachan, a broadcasting industry analyst at the Value Line Investment Survey, says CBS management is not about to be backed into a corner: ``CBS has a young, energetic management team -- the best in the industry. They will resist any takeover.''

Mr. Strachan points out that CBS is not really comparable to ABC, which last month announced a merger with Capital Cities Communications Inc. With ABC, corporate succession was in question; not so with CBS. Moreover, ABC was a friendly merger. CBS has dug in its heels against hostile takeovers.

Last week, a day after financier Boesky became CBS's largest shareholder, CBS management refused to meet with him or to consider buying back his shares at a premium. Mr. Barthel says he thinks the reason CBS rebuffed Mr. Boesky was negotiations with a white knight.

Barbara Dalton Russell, broadcasting industry analyst with Prudential-Bache Securities in New York, says Boesky appeared to have ``bought on speculation'' because of the ABC-Cap Cities deal. But because another Cap Cities is not around, she thinks it is Boesky who may have miscalculated.

In the realm of ``hot stocks,'' moreover, the current financial position of CBS leaves something to be desired. First-quarter profit was down 57 percent over a year before, the network announced Monday. Part of that was due to recent publishing acquisitions and the absence of the huge earnings garnered by the CBS record division last year with the Michael Jackson ``Thriller'' album.

The ABC-Capital Cities merger, says Mr. Barthel, sparked widespread interest in broadcast industry stocks: ``Until the time of that deal, these stocks were not being played. They've been rejuvenated, in the intermediate term at least.''

The Cox family of Atlanta announced Monday a $1.3 billion tender offer for the about 55 percent of Cox Communications Inc. it doesn't already own. The Cox group owns 21 newspapers, including the Atlanta Journal and Constitution, seven television stations, five AM and seven FM radio stations, and a cable television system.

``The broadcasting industry has become supercharged,'' Pru-Bache analyst Barbara Russell says. Driving it, she says, is a revised Federal Communications Commission rule, which became effective last week, allowing acquisition of up to 12 stations by any one owner as long as its total market share does not exceed 25 percent.

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