Amadeusz Juskowiak

Redstone details sweetened viacom via offer

Investor Sumner Redstone who leads one of the two groups vying for control of Viacom International Inc offered to sweeten his bid for the company by 150 dlrs a share cash and 150 dlrs in securities

In a filing with the Securities and Exchange Commission Redstone who controls Dedham Massbased National Amusements Inc a theater chain operator offered to raise the cash portion of its Viacom offer to 42 dlrs a share from 4050 dlrs

Redstone also raised the face value of the preferred stock he is offering to 750 dlrs from six dlrs

The Redstone offer which is being made through Arsenal Holdings Inc a National Amusements subsidiary set up for that purpose which also give Viacom shareholders onefifth of a share of Arsenal common stock after the takeover

Viacom said earlier today it received revised takeover bids from Redstone and MCV Holdings Inc a group led by Viacom management which is competing with Redstone for control of the company and already has a formal merger agreement with Viacom

The company did not disclose the details of the revised offers but said a special committee of its board would review them later today

The Redstone group which has a 195 pct stake in Viacom and the management group which has a 54 pct stake have both agreed not to buy more shares of the company until a merger is completed unless the purchases are part of a tender offer for at least half of the outstanding stock

The two rivals also signed confidentiality agreements which give them access to Viacoms financial records provided they keep the information secret

In his SEC filing Redstone who estimated his cost of completing the takeover at 295 billion dlrs said Bank of America is confident it can raise 2275 billion dlrs

Besides the financing it would raise through a bank syndicate Bank of America has also agreed to provide a separate 25 mln dlr for the limited purpose of partial financing and has committed to provide another 592 mln dlrs Redstone said

Merrill Lynch Pierce Fenner and Smith Inc has increased its underwriting commitment to 175 mln dlrs of subordinated financing debt for the Viacom takeover from the 150 mln dlrs it agreed to underwrite earlier Redstone said

Redstone said his group would contribute more than 475 mln dlrs in equity toward the takeover

The Redstone equity contribution to the takeover would consist of all of his groups 6881800 Viacom common shares and at least 118 mln dlrs cash he said

The new offer the second sweetened deal Redstone has proposed in his monthlong bidding war with management also contains newly drawn up proposed merger documents he said

Last week the management group submitted what it called its last offer for the company valued at 31 mln dlrs and consisting of 3850 dlrs a share cash preferred stock valued at eight dlrs a share and equity in the new company Redstones previous offer had been valued at 32 billion dlrs