Rare Cartoon Cell Given out to Executives
Time Warner Entertainment Deal June 30, 1992 Daffy Duck, Bugs Bunny & Tweety Bird
HBO, New York 1, 6 Flags , E, Comedy Central, BET, DC Comics, Warner Bros. & Time Warner
19” x 17”
Framed Matte & Glass
Japanese partners close Time Warner deal
JUNE 30, 1992
LOS ANGELES -- Time Warner Inc. said Tuesday that Toshiba Corp. and C. Itoh & Co. Ltd. have completed their $1 billion investment in the entertainment giant.
The two Japanese companies will each hold 6.25 percent stakes in a new venture, dubbed Time Warner Entertainment Company L.P., comprised of most of Time Warner's film, cable and pay-television businesses.
The Japanese companies will also hold 25 percent stakes in Time Warner Entertainment Japan, which is designed to expand Time Warner's existing entertainment businesses in that country, particularly in the cable-TV area. Analysts say the cable area has strong potential for growth in Japan with the growth of interactive devices.
Time Warner Inc. will own the remaining 50 percent of Time Warner Entertainment Japan.
The venture is the third major investment by Japanese electronics companies into U.S. entertainment production, following Sony Corp.'s 1989 purchase of Columbia Pictures for $3.4 billion and Matsushita Electric Industrial Co. for $6 billion.
But the deal, first announced last October, contrasts sharply with the previous agreements. Analysts have noted that Toshiba and C. Itoh proceeded cautiously to work out their investment in Time Warner, the second-largest cable operator in the United States and a producer of cable shows through its Home Box Office unit.
Time Warner, which took on more than $10 billion in debt in order to merge Time Inc. and Warner Communications Inc. three years ago, also said a consortium of banks led by Bankers Trust and Chemical Bank have completed a previously announced $6.2 billion bank credit facility for Time Warner Entertainment.
It also completed its acquisition of 18 percent of the outstanding shares of American Television and Communications Corp. last week.
Standard & Poor's rating agency announced Tuesday it had upgraded several debt issues, totaling $7.5 billion, following completion of the deal with Toshiba and C. Itoh.
S&P raised its ratings on Time Warner's senior debt to triple-B-minus from double-B and preferred stock to double-B from single-B-plus.
It also raised ratings on Warner Communications Inc.'s and Lorimar Telepictures Corp.'s subordinated debt to double-B-plus from single-B- plus, and American Television & Communications Corp.'s senior debt to triple-B-minus from double-B.
The agency also boosted its rating on $850 million of Time Warner Entertainment's senior notes, which were privately issued in April, to triple-B-minus from double-B.
S&P said the upgrades reflect the elimination of near-term refinancing risk of the prior bank agreement and extension of debt maturities, despite a modest increase in interest costs. It said the potential for more upgrades is limited over the near term.