NEW YORK — Viacom Inc. agreed to raise its bid for the outstanding 20% of Spelling Entertainment Ltd. by 75¢ a share to $9.75, or $179 million, and won approval for the deal from Spelling’s independent directors, the two companies said Monday.
Viacom said it signed a definitive agreement with the board of Spelling, now 80% owned by the entertainment conglom, and will start a tender offer to buy the outstanding stock later this week.
Spelling’s special committee of independent directors was advised by investment bank Lazard Freres that the higher offer was “fair to Spelling shareholders other than Viacom from a financial point of view.” Two months ago Viacom offered $162 million for the outstanding 20%.
Viacom plans to consolidate Spelling’s Worldvision distribution operations with Paramount Television Group, merging the back-office functions of both companies. Worldvision is the most valuable part of Spelling, holding rights to more than 8,000 hours of programming domestically and 18,000 hours internationally.
Spelling’s production unit, which makes such hits as “Beverly Hills, 90210,” will continue to operate as a separate banner within Paramount. Aaron Spelling will likely become chairman of Spelling Television.
Spelling president Peter Bachmann hasn’t disclosed his future plans, but is expected to stay at least until the expiration of his contract at the end of the year. Spelling declined comment.
Spelling stock rose 68¢ to $9.56 Monday while Viacom stock fell $1.37 to $37.87.