The Miami Herald from Miami, Florida • 33

i NYSE7B AMEXNASDAQ9B OTCOPTIONSIOB Wednesday December 10 1986 The Miami Herald 5B Channel 33 files Easiness Letter for Chapter 11 Channsl Bill What the station owes to whom: television ad revenues had grown between 12 and 14 percent annually But since an industry downturn mid-1985 brought about by competition and a lower inflation rate national television ad revenue growth has fallen to 2 to 3 percent Cheen said Meanwhile Grant was paying top dollar for programming broadcasting highly popular movies and television shows went in and said going to make a splash and get ratings right So he came in and bought everything in Cheen said But the ratings did not come as Grant anticipated During the November ratings for example Channel 33 registered a 267 percent share of the market tied with Channel 6 and lowerthan anticipated 4 to 5 percent share of the market Market share determines a television ad rates station plan to lay off any of its approximately 50 employees Grant which started Channel 33 on Dec 9 1984 attributed its financial difficulties to poor timing in its markets Grant is owned by Milt Grant who started his first station in Washington DC in 1966 The financial plans of the three stations which all went on the air during the last two years were when those markets and the industry as a whole were at their the company said But and lower-than-projected advertising revenues prevented the companies from attaining their financial Grant got caught in a ratchet of flat advertising said Bruce Bishop Cheen senior media analyst at Paul Kagan Associates a California media consulting firm When Grant started the stations By JOAN CHRISSOS Herald Business Writer Channel 33 filed for Chapter 11 protection from its creditors Monday the day before the second birthday At the same time two of WBFS-Channel sister stations Channel 57 in Philadelphia and Channel 66 in Chicago filed for reorganization in US Bankruptcy Court in Philadelphia All three stations are owned by Miami-based Grant Broadcasting System which said it will continue operating the stations Under Chapter 11 of federal bankruptcy laws a company can continue operating under court supervision while it seeks to repay its debts plan to reorganize and to seek an equity said Richard Lie-berman Channel 33's director of finance At the moment he said the i1 High court ruling could spur mergers from Herald Staff and Wire Reports In a ruling that may add momentum to merger activity the Supreme Court said Tuesday that businesses cannot block acquisitions by rivals merely by showing a projected dip in profits The 6-2 decision in a meat-packing industry case is bound to make it more difficult for companies to win lawsuits challenging mergers by their competitors But the justices stopped short of endorsing a Reagan administration position aimed at barring all such lawsuits Justice William Brennan said for the court that a company that invokes federal antitrust law in trying to block a merger "must show a threat of antitrust injury" The Reagan administration had urged the court to impose a broader ban on private antitrust lawsuits arguing that such suits could become routine in preventing mergers that would yield more efficient businesses Source Bankruptcy Court Papers Shooting Sown a BeaS Eastern Airlines has decided to cut Us relationship with CF Air Trends THE STOCK market moved lower in lackluster trading The Dow Jones industrial average closed at 19169 off by 1336 points from Monday Analysts attributed the decline to various factors including year-end tax-selling and continued profit-taking in the wake of last 4303-point upward surge HIGH-PAYING jobs are getting harder to find More than half the 8 million net new jobs created between 1979 and 1984 in the United States paid less than $7000 a year while the number of jobs paying $28000 or more actually fell according to study released Tuesday by the outgoing and new Democratic chairmen of the Joint Economic Committee of Congress The study said the middle-income share of job growth dropped from 642 percent in the 1970s to 475 percent in the early 1980s and warned of growing income inequality not going to talk about Texas Glenn Parsons Eastern Airlines Texas viewpoint you want to be competing with yourself Jim Allen CF Air The details SERVICE began in 1984 with CF Air leasing the freight space on Eastern's A300s CF began with 76 shipments per flight Currently they carry 2000 shipments per night fares ($79 at lip m) compete directly with ($69 at 555p m) national Pratt parent plans to cut 11000 jobs No additional layoffs foreseen in Florida HARTFORD Conn (Reuters) United Technologies Corp said Tuesday it expects to cut about 11000 jobs over the next year as part of a restructuring plan and that its board approved a massive $592 million charge against fourth-quarter profits The cuts which represent about 59 percent of the 188000 worldwide workforce include the elimination of 1500 to 2000 jobs within its Pratt Whitney subsidiary which were announced last month company spokesmen said Initially about 170 employees at aircraft-engine design facility in northwestern Palm Beach County have been asked to either take new jobs or leave the company The company said the $592 million pretax charge includes $237 million for the estimated costs of the job reductions The rest of the writeoff will cover expected losses from the sale of certain smaller businesses in its restructuring The company said that despite the heavy charges and an expected fourth-quarter loss it will report a profit for the year United 1985 profit was $3127 million down from $645 million a year earlier It said it would attain future business growth by concentrating on its Pratt and Whitney jet engines Carrier air conditioning Otis elevators automotive products and its Essex and Hamilton standard aerospace controls divisions core businesses are strong and we intend to strengthen and expand said Robert Daniell president and chief executive officer The move by the Hartford-based company a diversified manufacturer and major military contractor is viewed as part of a wave of restructurings timed to be completed in the current tax year to gain more generous tax treatment than will be available under the tax reforms effective next year The restructuring also expands on previous efforts at reducing exposure to weak-performing business segments The biggest was its move to shut down much of its Mostek semiconductor operations following hundreds of millions of dollars in losses in recent years Attrition layoffs and the sale of certain smaller operations will all be used to accomplish the new round of workforce reductions which are expected to affect mainly salaried employees but will also include some hourly workers OPENING ARGUMENTS started in financier Marvin fraud trial An Ohio state prosecutor Tuesday accused three principals of the collapsed Home State Savings Bank of making unauthorized fund transfers designed to shore up ESM Government Securities of Fort Lauderdale and to guarantee them secret profits Mark Vander Laan an assistant prosecutor told the Cincinnati jury that former Home State owner Warner and ex-Home State presidents Burton Bongard and David Schiebel acted despite warnings from Ohio regulators Eastern cuts freight contract endangered Companies BOARD rejected corporate raider Asher takeover offer The restaurant chain operator said its board unanimously recommended that stockholders reject the $220 million takeover offer by Pon Acquisition Corp led by Edelman Separately Edelman renewed his proposal to buy Lucky Stores Inc for $188 billion the Dublin Calif-based supermarket chain said I i I I I 1 In Florida dubbed the past next March 1 Other options include keeping it in Houston or moving it to another city possibly Chicago company spokesmen said Allen said the main reason behind the cancellation involved the failure of the two companies to agree on a new central location wanted to move the hub out of Houston and we were willing to work with them on another he said just find a place where everybody was happy so everybody decided to go a different way" In a statement CF president Donald Berger said the new Indianapolis operation will initially employ 350 people The company expects to lease 10 acres of warehousing and other facilities there and move a million pounds a night Eastern spokesman Glenn Parsons refused to say whether the airline acted on instructions from Texas Air its new parent which formally took control of the company late last month not going to talk about Texas Parsons said He did say that Eastern is continuing "to evaluate the whole By DAVID LYONS Herald Business Writer Eastern Airlines on March 1 will cancel its overnight freight contract with CF Airfreight Inc the basis of its cargo-passenger service to 15 cities nationwide company officials confirmed Tuesday The action has forced the Palo Alto Calif freight forwarding firm to relocate its night cargo operation from its Houston hub to Indianapolis "Eastern is the one that is ending the contract with said CF spokesman Jim Allen primary reason for the move stems from when Eastern was taken over by Texas Air Corp It's a different company with different business strategies" Allen suggested that Texas Air did not want Eastern competing with Continental Airlines another subsidiary want to be competing against yourself" he said But airline schedules show that Eastern flies in and out of Houston uncontested during the late night hours Eastern meanwhile says it is trying to decide whether to continue its overnight freight service MCA plans Orlando studio NEW YORK Air unveiled a $29 promotional one-way Miarai-Washington fare From Dec 15-17 Miami passengers will be able to fly to Washington Dulles for $29 one way as New York Air inaugurates its new Miami service After Dec 17 the one-way fare to Washington will be $99 off-peak and $129 peak A $75 each-way fare is also available with a seven-dav advance roundtrip purchase SENSORMATIC OFFERED to increase the price of its bid for Vicon Sensormatic had said it would increase the price of its existing tender offer to purchase all outstanding Vicon Industries common shares at $7 50 per share Sensormatic said it does not intend to engage in further negotiations HOME SHOPPING Network announced sharply increased quarterly sales and earnings Net sales for the first quarter totaled $1035 million up 319 percent from the $247 million reported in the same period last year for the Clearwater provider of televised shop-at-home services Net income reached $95 million or 22 cents a share up 258 percent from $27 million or 7 cents a share A FORT Lauderdale contractor is dropping its case against Lotus Development James A Cummings Inc had alleged that bugs in computer software the company to make a $254000 error Under the agreement the suit will be dismissed with prejudice and no payment will be made to the contractor or its attorney Lotus announced Cummings said it had used Lotus's popular Symphony software to prepare a bid on an office complex worth more than $3 million but said the spreadsheet failed to add $254000 in administrative expenses they have made public looks very similar to what we said in 1981 we would MCA President Sid Sheinberg II Ross Perot: Stock buyout will silence GM critic Perot deal may delay GM research DETROIT (Reuters) The payment of almost $750 million by General Motors Corp to buy the silence of ousted maverick director Ross Perot may delay the introduction of some important new GM vehicles according to industry specialists A report in the trade journal Metalworking News this week says a prime candidate for delay due to the depletion of cash reserves in the Perot affair is the GM10 project which includes a mid-sized Chevrolet car due to be offered to the public 1989 If this happens GM would be paring back product plans which analysts believe will be vital to the world's largest ability to compete not only with domestic rivals Ford and Chrysler but more importantly with the flood of Japanese companies importing cars and beginning to build them on American soil 1 he GM-Perot wrangle has dominated news from America's since the beginning of the month and marks the biggest top-level corporate purge at the troubled automaker since 78-year-old GM became one of the nation's premier industrial companies more than five decades ago Because 1986 GM profits are significantly below last $4 billion the decision to The Money Line By LARRY BIRGER fiusmcssMortday Editor ORLANDO MCA Inc announced Tuesday it was going forward with construction of a huge movie studio and theme park southwest of the city in direct competition with a similar project proposed by rival Walt Disney Productions The parent of Universal Studios said it believed the long-delayed project could be successful despite speculation that planned $300 million movie studio adjacent to Walt Disney World in Lake Buena Vista had squeezed out project MCA President Sid Sheinberg declined for competitive reasons to place a price tag on his project In 1981 when MCA first announced it would build a studio in Florida the project was expected to cost $203 million and attract 2 5 million visitors a year Tuesday Schemberg said the Universal studio would attract six million visitors to a studio tour in 1989 its first year Moviemaking will begin in 1988 MCA producer of films and television shows including Miami Vice expects to make from 15 to 24 movies a year MCA is being joined in the project by Cineplex Odeon a Canadian company identified as the largest film exhibitor in North America by its chairman Garth Drabinsky The company which is 50 percent owned by MCA runs Plitt Theaters which has 77 screens in 21 locations in Tlorida The project will be built on 414 acres at the intersection of Interstate-4 and Turnpike Besides the studio the complex will include hotels restaurants theaters a concert hall and office buildings The tour will be patterned after successful Florida Prime Rate 75 Florida Fixed Mortgage Rate 979 13-week T-bills 551 26-week T-bills 550 Money-Market Fund 7-day Avg 522 Fla Avg Money Market Account 536 attraction in Southern California About 2500 are expected to be employed during the peak winter season The Disney-MGM Studio Tour to be completed in late 1987 will include a motion picture and animation studios as well as ride-through fantasy attractions with movie themes The 40-acre attraction is part of the entertainment plan to revamp its ailing movie business promote its theme parks and develop its valuable Florida property Scheinberg in a veiled reference to competition with Disney said the MCA project take a back seat to any movie tour in the Asked if Disney had stolen idea he said "You can draw your own "What they have made public looks very similar to what we said in 1981 we would build" Drabinsky said he hoped to draw more talent from Florida adding that it is less expensive to make movies in this state than in Ilolhwood I spend more than $700 million to buy large stock block brought a torrent of criticism from investors union leaders and members and analysts Perot's departure was engineered to stop his public attacks on the way GM does business and remove him from the company board where he had become a dissident force as biggest shareholder To save money GM had already cut spending on future projects including a new plastic-bodied car and more visibly its much-touted import-fighting Saturn small car project The new Chevrolet car reported to be under review for delay to conserve cash would compete in the market segment now occupied by the Chevrolet Celebrity The Bottom Line Stores of Miami said its November sales increased 39 percent from a year earlier to $8 2 million its sharpest increase in 16 months CenTrust stock rose 50 cents per share to $11 13 after it disclosed that two related insurance companies own 20 percent of its stock Shearson Lehman Brothers will boost its ownership to 30 percent in McLeod Young Weir Ltd third-largest investment dealer flklty ftl.