Turner empire set to be divided up

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The Independent Online
NEW YORK - Turner Broadcasting, the cable news and film group headed by Ted Turner, could be split up between Time Warner and Tele- Communications, the two large media companies that saved him from bankruptcy six years ago, writes Larry Black.

The plan - which Wall Street analysts believe has Mr Turner's support - would dissolve the company, awarding Time Warner control of CNN and Headline News, Mr Turner's two satellite news networks, while Tele-Communications would take over its two US entertainment channels and vast film libraries.

Mr Turner could receive as much as dollars 2bn for his 37 per cent stake in the group, and would retain a management role and some equity in the properties.

While still the largest shareholder, Mr Turner forfeited control of the board to the two companies when they injected fresh capital in 1987. Tele-Communications now holds a 22.5 per cent stake in Turner, and Time Warner 18.7 per cent.

Mr Turner has managed to turn both his news and movie channels into big money-makers since the bailout, but the ownership structure has proved frustrating for all three parties. He has sought to merge the company with a large production studio or broadcast TV network, but the two cable companies wanted to keep the assets from their competitors.

At the same time, neither is in a position to buy Turner Broadcasting outright - Tele-Communications has regulatory worries, while Time Warner has huge debts from its own 1991 merger. None the less, CNN would fit perfectly with Time Warner's news magazines and related media properties.

None of the three companies would comment directly on reports of the plan, which delighted Wall Street where Turner's shares rose dollars 1.75 to dollars 24.50 while stocks in both investors, battered in recent days by the imposition of new government price controls, fell again.