NEW YORK — TV Guide, a former News Corp. holding, has been sold for $9.2 billion in stock to high-tech group Gemstar Intl., a fierce competitor on the electronic TV listings front, TV Guide said Monday.
Gemstar, of Pasadena, will issue 0.657 shares of its own stock for each outstanding share of TV Guide, which has been in litigation with Gemstar over proprietary technology issues. Wall Streeters said the price was quite high, though the marriage makes some sense in that it will combine the powerful TV Guide brand name and Prevue listings channel with Gemstar’s electronic programming guides and other services.
“TV Guide’s relationship with publications, cable MSOs, programmers and content providers are perfect complements to Gemstar’s association with broadcasters and consumer-electronics manufacturers,” said Gemstar chairman and CEO Henry Yuen.
He said the deal will enhance the combined company’s vision of a fast-growing advertising and transaction business based on electronic program-guide platforms.
TV Guide magazine has a circulation of 11 million, and its TV Guide Channel has 50 million subscribers. Other assets include TV Guide Interactive, the Cable Guide, Sneak Prevue and TV Guide Intl.
News Corp. all but exited the U.S. magazine business when it sold its TV Guide stake in the summer of 1989 to United Satellite Video Group for $800 million plus a hefty stake in the newly created company. United Video was owned by Tele-Communications Inc., which wound up with a stake equal to News Corp.’s. TCI was later sold to AT&T Corp.
Word has it that melding TV Guide and United Video was difficult due to clashes of culture and geography. TV Guide is New York-based, while United Video Satellite is based in Tulsa, Oklahoma.
Gemstar stock sank on the news, falling 9% to $76.19.
TV Guide jumped, rising 11% to $45.94.