Hearst-Argyle Considers Buy-out

Special committee formed to respond
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NEW YORK: Hearst-Argyle moved quickly to consider an offer to be wholly owned by its parent corporation. Privately owned Hearst Corp. this week offered to buy the one-third chunk of Hearst-Argyle it did not already own. Hearst-Argyle (NYSE: HTV) consists of 29 TV stations. The parent corp., one of the biggest family print empires in the world, offered $4 for outstanding A shares of TV business. HTV was trading at around $2 at the time of the offer.

HTV responded by forming a committee to consider the offer. David Pulver is among its members. Pulver is a director at HTV and one of its predecessors, Argyle Television, and president of private investment firm, Cornerstone Capital. Caroline Williams, also an HTV and Argyle director as well as president of Gray Seal Capital, is also a member.

Hearst-Argyle said that it would advise stockholders of its positions within 10 business days of a formal tender by Hearst, which it said had made the offer without any prior agreement with HTV. Hearst-Argyle postponed its planned annual stockholder meeting to be held May 6.

Hearst made the offer Wednesday, having determined the TV business could fare the current market turmoil better under its wing.

“The substantial recent changes in the financial markets, as well as in the media markets in which Hearst-Argyle operates have focused our attention on Hearst-Argyle’s capital structure, its relatively high level of indebtedness, and its ability to refinance its debt on acceptable terms as it matures,” Hearst said in a letter to HTV shareholders. “We believe that if Hearst-Argyle were a wholly owned subsidiary of Hearst, it would more readily be able to navigate the troubled waters in which we find ourselves.” -- Deborah D. McAdams