MGM/UA Mum After Late Session on Murdoch Bid

A $1.8-billion offer by two Rupert Murdoch-controlled companies to acquire MGM/UA Communications was set to expire late Thursday, a source said, but by the end of the West Coast workday, the board had not given Murdoch an answer.

MGM/UA’s directors adjourned their meeting at 8 p.m. but a spokeswoman said no announcement would be made until early today, before the stock market opens. It was not clear Thursday whether Murdoch would grant an extension if MGM/UA asks for more time to ponder the offer.

The bid from News Corp. and Fox Inc., which includes the assumption of MGM/UA’s $400 million in junk bond debt, was presented to the 14-member MGM/UA board at a session that began at 10:30 a.m. at the firm’s Beverly Hills headquarters. At the end of the trading day on the New York Stock Exchange, MGM/UA shares had declined 62.5 cents to $20.625, with 358,200 shares changing hands.

For MGM/UA’s 800-plus employees, Thursday was simply another suspenseful chapter in the company’s 18-month effort to find a buyer satisfactory to controlling shareholder Kirk Kerkorian.

Until Murdoch’s surprise bid arrived at the company’s Beverly Hills headquarters Tuesday, the company was slated for sale to the Australian Qintex Group, which has offered to pay $20 a share for each of MGM/UA’s 53 million common shares outstanding. Qintex had agreed to sell certain assets back to Kerkorian, and the deal was to be put to an MGM/UA shareholder vote Sept. 23 at the Beverly Hilton Hotel.

Murdoch’s bid offered $23.16 for each share of common and $18 for Kerkorian’s preferred stock, and would result in acquisition of the entire company.

In a statement Wednesday, MGM/UA said that unless the board decided to proceed with Murdoch’s offer, it would expect to complete its merger with Qintex as scheduled by the end of September.