Biz Briefs: News Corp. Leads Intermix Bidding

Oct 3, 2005  •  Post A Comment

News Corp. appeared to come out on top in its effort to acquire Intermix Media last week despite a competing bid. Intermix, best known for its popular social networking site MySpace.com, rejected an unsolicited offer for the company from its former CEO, Brad Greenspan. He said two weeks ago that he was forming an investor group called FreeMySpace LLC to offer Intermix shareholders $13.50 a share for a significant interest in Intermix. The offer was seen as a premium over the $12-a-share bid that News Corp. has on the table to buy all of Intermix in a deal valued at $580 million. Mr. Greenspan had argued that News Corp.’s offer significantly undervalued Intermix.

However, Intermix officials in a statement last week said Mr. Greenspan’s offer “does not constitute and is not reasonably expected to lead to a transaction that is superior to the News Corp. transaction.”

Tribune’s Taxing Hangover

Newspaper and broadcasting group Tribune said last Tuesday that it will appeal a U.S. Tax Court ruling that could put the company on the hook for $1 billion in tax payments. The ruling related to a 1998 tax-free reorganization of Matthew Bender, a former spin-off of the Times Mirror Co., which Tribune acquired in 2000, along with the tax issue ruled upon last Tuesday.

While the company was unsure exactly how much the tax bill would be, it said it could end up hitting $1 billion, though deductions for state taxes and interest could reduce the figure to around $850 million. Tribune had set aside around $250 million for the tax dispute and now will begin to issue commercial paper to pay the tax bill immediately.

NBCU’s Dream on Hold

DreamWorks SKG announced last week that it has pulled the plug on its merger discussions with NBC Universal’s film unit just as the window for the two companies to be able to hold exclusive negotiations was set to close. The two companies had been in discussions since July about a possible combination, but reports indicate the talks stalled over DreamWorks’

$1 billion price tag and issues of control. A report in last Tuesday’s Wall Street Journal said one factor was director Steven Spielberg’s desire to retain the kind of independence he enjoys at DreamWorks.

Universal had hoped to snag DreamWorks to gain access to its 60-title film library and bolster DreamWorks’ film production. Universal also hoped the deal would bring it closer to Mr. Spielberg, who remains a big draw for many audiences and has a long history with Universal on blockbusters such as “Jurassic Park.” Universal also currently handles international sales and home video distribution for DreamWorks.