Robertson poised to sweeten TVS offer

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The Independent Online
INTERNATIONAL Family Entertainment, the Reverend Pat Robertson's cable TV company, is poised to increase its offer to preference shareholders in TVS Entertainment by as much as 50 per cent.

It hopes this will stop rebel institutions from blocking the pounds 50m takeover bid for the ITV group, which loses its franchise in 10 days.

Morgan Grenfell, the merchant bank acting for IFE, is next week expected to outline a higher offer to the the institutions leading the resistance.

IFE is offering shares worth 35p, or 23p cash, for the ordinary shares, and shares worth 65p, or 43p cash, for the preference shares.

The offer has been accepted by a majority of ordinary shareholders, but by pref holders representing less than 12 per cent of the shares in issue. IFE needs acceptances from 75 per cent of the prefs to complete its offer, and it is understood the rebels control more than 25 per cent.

However, the institutions believe the preference shareholders are getting a raw deal because they would have to be paid out in full before ordinary shareholders received a penny if the group was liquidated.

One leading preference holder has said that if IFE offered cash of 65p, matching the share offer, it might be acceptable to him. Another said that anything short of 80p a pref share would be an insult. It is understood that any new offer may be in the region of 65p cash.

Morgan Grenfell has also indicated that IFE might simply walk away from the deal. However, the fact that it has applied to start a European version of its successful US cable TV service, The Family Channel, and has already started using the offices and services of TVS would make it difficult to change tack.

IFE started talking to TVS in the summer. In September it said it might make an offer, but had to wait for regulatory approval in the US until November. The bid on the table closes early next month.

After TVS gives up its franchise, it will have more than pounds 20m in cash and the only business left in the group will be MTM Entertainment, the Hollywood TV studio.