FED SHUTDOWN DELAYS DISNEY’S CAP CITIES BUY
NEW YORK — Although shareholders of both companies on Thursday approved a $19 billion acquisition by Walt Disney Co. of Capital Cities/ABC, the completion of the deal is expected to be delayed by the partial shutdown of the Federal Government.
Capital Cities/ABC is the parent of Fairchild Publications, which publishes WWD.
The Disney/Capital Cities merger was scheduled to be completed today, but it has not yet been approved by the U.S. Justice Department or the Federal Communications Commission. An attorney for Disney said the primary approval required was from the FCC and the deal was on the FCC calendar for Jan. 18. The Disney attorney, Sanford Litvak, said that once FCC approval was obtained, “I don’t expect anything will delay the completion of the merger.”
However, a spokesman for Capital Cities said that the section of the Justice Department responsible to rule on the merger on an antitrust basis is “shut down” and this will delay the merger’s completion.
The merger agreement provides for payment of $65 in cash and one Disney share for each share of Capital Cities.
Disney stock closed Thursday at 60 1/2, off 3/4 and Capital Cities shares closed at 124 1/8, off 7/8.