Copyright 2004 Gannett Co. Inc.
November 10, 2004, Wednesday, FIRST EDITION
Liberty Media CEO Robert Bennett did his part Tuesday to try to quash growing speculation that his company's chairman, John Malone, is positioning himself to take a run at Rupert Murdoch's News Corp.
Bennett told analysts, in a quarterly earnings conference call, that he and Malone remain "allies of News Corp. and the Murdoch family" despite Liberty's decision last week to increase its voting stake in News Corp. to 17 percent from 9 percent.
That clearly worried Murdoch, who controls 30 percent of the votes. His company, which owns the Fox movie and TV empire, responded this weekend by adopting a poison pill anti-takeover defense, noting in a statement that Liberty had acted "without any discussion with, or prior notice to, News Corp."
But Bennett told analysts that Liberty is simply seizing a rare market opportunity to swap its non-voting News Corp. equity for voting shares. Many Australian funds are unloading News Corp. holdings as it re-incorporates in the USA. That process should be complete on Friday.
"It was an opportunity to buy voting shares while they were cheap," Bennett says.
He adds that Malone and Murdoch have had several "friendly and cordial" conversations this week. "We don't have hostile intentions."
Yet Bennett declined to comment on another view: that Malone may want to pressure Murdoch to buy some of Liberty's programming assets, which include QVC, Starz Encore and 50 percent of Discovery Communications. "I'm not going to speculate about anything," he says.
In other media news:
Adelphia Communications said in a statement that it's "pleased" with a proposal from a group of unsecured creditors that is designed to help the company escape from bankruptcy-court protection even as it puts itself up for sale.
The creditors said that they would be willing to accept stock in the No. 5 cable operator once it's back on its feet. They said the company is worth $17 billion. That plan gives Adelphia an option if bids — which will probably include a joint offer from Time Warner and Comcast — come in at low-ball price levels.
But the company says that the process is "robust" with "a high number of bidders." It expects final offers in January.
EchoStar remained on a roll in wooing subscribers from cable operators in the third quarter.
The company, known for its Dish Network, picked up 350,000 customers, bringing its total to 10.5 million.
"Cable's got the biggest turf to defend at a time when they're highly leveraged and continuing to lose core customers," CEO Charlie Ergen says. "You're going to have a free-for-all for 67 million subscribers."
The satellite pioneer says his company still is struggling to correct procedural inefficiencies, for example in customer service. "I'm disappointed they've gone on as long as they have."
But he cheered up investors by announcing a one-time dividend in December of $455 million, equal to $1 a share.
EchoStar closed at $30.71, up 69 cents.