NEWS - September 22, 1999 - TEXT VERSION ONLY ----------------------------------------------------------- FROM AUSTRALIA Seven shares up as GPG builds stake By KEVIN MORRISON Seven Network shares jumped by more than 3.5 per cent yesterday amid speculation that Sir Ron Brierley could be building a stake in the embattled commercial network. The shares rose as high as to $4.92 before ending up 15c at $4.90. Seven's share price has risen 16 per cent in the past 12 trading sessions, rising steadily since the release recently of its year-to-June earnings. Stockbrokers said yesterday that Sir Ron's cashed-up Guinness Peat Group was a more likely buyer of Seven shares than the New Zealand-based Brierley Investments. GPG has about $450 million in cash after selling out of its controlling stake in insurer and funds manager Tyndall Australia. It has built up stakes in Australian and UK companies and is keen to become more of a corporate raider than it was through most of the 1990s. Among its plays are a hostile takeover bid for Joe White Maltings with a view to breaking up the maltster. A GPG spokesman declined to comment. Sources said GPG had been doing some buying through stockbroker JB Were and Son, and had been accumulating Seven shares over the past three months, as the stock hit its year lows. During this period, Seven has had an unsettling time because of the large write-downs of its programming library and the exit of former chief executive Mr Julian Mounter, while the network's high cost structure continued to cap profitability. Nominee companies of the Melbourne-based stockbroker have accumulated about a 3 per cent stake in Seven over the past few months. "There is talk that Brierley is buying into Seven," said one Sydney-based broker. "He seems to be adopting their normal strategy of buying into a company when it is going through an unsettling period." JB Were has bought about 2.3 million Seven shares since the start of September. Macquarie Equities, which has a strong buy recommendation on the stock, has bought about the same number in a similar time frame. Brokers said yesterday there has also been speculation about rumours that Warburg Dillon Read had approached disgruntled Seven shareholders seeking to buy their shares off-market. The Swiss-owned investment bank was appointed by Seven chairman Mr Kerry Stokes as the broker for the network's $325 million share buyback in June. Stockbrokers did not rule out the prospect of Mr Stokes seeking to raise his 33 per cent stake in Seven. The latest bout of speculation surrounding Seven follows talk in May that both Mr Rupert Murdoch's News Corp and Mr Kerry Packer's private company Consolidated Press were to buy into Seven, although there has been no evidence subsequently of either company emerging on Seven's share register. ......end news item 1, September 22, 1999 ........... ----------------------------------------------------------- FROM AUSTRALIA - FINANCIAL REVIEW Optus moves to exit pay-TV By Luke Collins Cable & Wireless Optus has begun talks which could see it sell the management rights to its loss-making pay-TV subsidiary as part of a deal to deliver outside parties access to the telecommunications carrier's national broadband cable network. The talks come as jostling to gain access to both Optus and Telstra's cable networks intensifies, as media companies, software developers and a host of content providers seek to secure positions as major communications players. The Ten Network, in conjunction with its major shareholder, Mr Izzy Asper's CanWest Global Communications Corporation, is believed to be one of a number of parties talking to Optus about its cable network. While Ten is interested in establishing a position against its free-to-air rivals in the emerging datacasting and multi-channelling fields, Optus is keen to tie any broadband-access deal to removing itself from the management of its pay-TV arm, Optus Television. That could involve the sale of equity in Optus Television, formerly Optus Vision. Optus has consistently maintained it is not a pay-TV operator and is known to have seriously considered the future of the pay-TV group when the United Kingdom company Cable & Wireless became its dominant shareholder. "They're offering the management rights," one source close to the situation said. "I don't think they're actually going to sell the entity [but] I would assume [equity in Optus Television would be sold]." Optus's director of regulatory affairs, Mr Stephe Wilks, last night said the company was "not going to comment on rumour or speculation". The decision to tie Optus Television to any access deal complicates matters for those keen to use the broadband cable network, which is rumoured to include major Optus Television program supplier Village Roadshow and ninemsn, the internet joint venture between Mr Kerry Packer's ecorp and Microsoft. Optus Television recorded revenues of $52.5 million in the six months to the end of 1998, but its parent company has not separately stripped out its earnings since. The pay-TV group has more than 210,000 subscribers and has been experiencing strong success with its bundled offerings of telephony, TV and internet services. Earlier this year, it successfully renegotiated its contracts with three Hollywood movie studios and Village Roadshow in a move that dramatically slashed its minimum subscriber guarantee payments and its cost per subscriber. That renegotiation was finally sealed three weeks ago and is expected to save Optus Television more than $250 million over six years. In July, Optus Television renegotiated its supply deal with the Walt Disney Company to save a further $85 million over the same period. Industry watchers regard the pay-TV group, headed by Mr Mike Lattin, to be in a substantially stronger position financially and operationally ahead of its planned major marketing push due to begin next month. However, the real lure for those talking to Optus is the company's $3.5 billion broadband cable network, which delivers not only pay-TV but a host of other services and will become increasingly important as communications convergence gathers pace. While Optus has already formed optus@home as its high-speed internet platform, other companies are keen to use the network for purposes including datacasting and multi-channelling. Major players in that sector include John Fairfax Holdings and Mr Rupert Murdoch's News Limited. ......end news item 2, September 22, 1999 .... ------------------------------------------------------------------- INTERNATIONAL PAY TV & ENTERTAINMNET NEWS IN BRIEF SEPTEMBER 22, 1999 BARRYMORE EYES BARBARELLA: Drew Barrymore is in negotiations star in a big-screen remake of Barbarella, Variety reports. She will, of course, play the title character, a futuristic sexpot made famous by Jane Fonda. The remake will eschew the campier aspects of the original Fonda flick and will instead be faithful to the edgy comic strip on which the film is based. DELTA BURKE GETS POPULAR: Former Designing Women diva Delta Burke is making a play for the teen audience. Liz Smith reports that actress/fashion designer will guest-star on an upcoming episode of the WB's Popular in a part tailor-made for her talents by Popular honcho Ryan Murphy. Burke will play the mother of a cheerleader on the episode, which airs Nov. 11. WILL HASSELHOFF LEAVE BAYWATCH?: Hold on to your swimming trunks - David Hasselhoff is considering leaving Baywatch, AP reports. "This may be my last season, the actor is quoted as saying. "Honestly, I don't know yet. See, the show is going through a rebirth. Whether I stay or leave the show remains to be seen. The option is open." The 47-year-old actor says he wants to pursue other projects, like starring in a Broadway show (it worked for Tony Danza!) and recording an album in Spanish. Ay, Caramba! OSMOND GETS HER GUN: Hot on the heels of the news that soap diva Susan Lucci is in negotiations to star in the Broadway revival of Annie Get Your Gun when star Bernadette Peters takes a vacation comes word that Marie Osmond will star in the show next summer. The New York Daily News reports that Osmond is looking for a New York apartment to crash at during her Annie run. FYI, still no confirmation on either Lucci's or Osmond's stints in the musical. NETWORKS PILOT MOVIE HITS: Everything old is new again when it comes to developing a series for network TV. Variety reports that CBS is working on a pilot based on the hit series The Fugitive, which in turn spawned a successful 1993 movie starring Harrison Ford. "We are very aware that we are tempting the gods in trying to do this series," producer John McNamara tells Variety. Meanwhile, Fox is working on a pilot based on the 1997 flick L.A. Confidential; the project was being developed at HBO, but the cable channel ultimately passed and Fox jumped at the chance to snatch it up. Variety reports that the TV series will take place eight years before the 1997 movie and will focus on the male soap opera aspects of the story. PUBLISHER BLASTS 3RD ROCK: Perhaps taking a cue from the Stark Raving Mad mental illness controversy or the recent criticism of smoking aliens on 3rd Rock From the Sun - and taking a cute joke a bit too far - Zen Comics Publishing has named 3rd Rock as the television program most offensive to aliens! "3rd Rock is particularly offensive for its portrayal of aliens as hopelessly gullible, pathetically foolish and terminally moronic beings who are ill-equipped to deal with modern society," Zen publisher Steve Stern said in a statement. ......................end news September 22, 1999 ----------------------------------------------------------------------------