Former Time Warner Inc. Chairman and Chief Executive Officer Richard Parsons said Rupert Murdoch’s $75 billion offer for his old company is inadequate.
The nonvoting shares being offered, a reliance on debt by Murdoch’s 21st Century Fox Inc. and Time Warner’s own growth prospects make the deal unappealing for investors, Parsons said yesterday in a Bloomberg Television interview.
“The price offered is way off the mark and the form of currency is way off the mark,” Parsons said.
Parsons is offering public support as his successor, Time Warner Chairman and CEO Jeff Bewkes, fends off the unsolicited bid from Murdoch. Now interim CEO of the Los Angeles Clippers basketball team, Parsons said his comments aren’t based on direct knowledge of Time Warner’s plans. However, he has insight into how executives at the New York-based company think.
“I know the Time Warner management very well because I put most of them in place,” Parsons said. “I know the board pretty well.”
Parsons, a former banker, became president of Time Warner in 1995, and served as CEO from 2002 until he passed the baton to Bewkes in January 2008.
Time Warner is a “long, long way from a transaction,” Parsons said, adding the home of HBO, CNN and the Warner Bros. studio would be better off remaining independent.
“Everybody loves a fight where everyone is arm wrestling but Time Warner is a big morsel,” Parsons said. “They have excellent management, an excellent board, real value. The future is infinite.”
Bewkes, whose Time Warner career began at HBO in the 1970s, is resisting an $85-a-share cash and stock offer by Murdoch’s Fox, which also owns cable networks such as FX and Fox News, and produces competing films and TV shows.
Time Warner’s board has decided the company can do better staying independent, even if Murdoch were to bid as much as $95 a share, according to people familiar with the thinking.
Time Warner rose 1.2 percent to $84.83 at 9:47 a.m. in New York. Through yesterday, the shares had increased 18 percent since July 15, the day before Murdoch’s bid became public.
Fox increased 0.8 percent to $32.41. The sharea had dipped 8.6 percent over the same span.
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