Paramount set to appeal court's takeover decision

Click to follow
NEW YORK - The Delaware Supreme Court indicated yesterday that it will give Paramount Communications leave to appeal Wednesday's decision by a lower court, which stripped the entertainment conglomerate of a number of anti-takeover devices aimed at making a hostile takeover of the company prohibitively expensive, writes Michael Marray.

The Supreme Court said that it would consider an appeal quickly, with 9 December a likely date for a hearing. The appeal further delays a resolution of the two-month old struggle between Viacom and QVC for control of Paramount in a dollars 10bn takeover battle. Paramount's interests include movie studios, publishing and the New York Knicks basketball team.

Wednesday's court decision was seen as a big victory for QVC, with Judge Jack Jacobs criticising Paramount management for acting improperly by failing to explore adequately the QVC offer on behalf of shareholders, and instead simply trying to push through their own plans for a friendly merger with Viacom.

'Meeting with QVC was the last thing management wanted to do, and by skilful advocacy management persuaded the board that no exploration was required,' Judge Jacobs said in his decision.

Viacom said yesterday that it was pleased by the decision to allow an appeal, adding that it intends to extend its tender offer for Paramount shares until the appeal has been heard.