SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
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CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
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Date of Report (date of earliest event reported): July 25, 1995
VIACOM INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-9553 04-2949533
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
1515 Broadway, New York, New York 10036
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 258-6000
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Item 5. Other Events.
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On July 25, 1995, Viacom Inc., a Delaware corporation ("Viacom"), announced
an agreement to spin off its cable systems serving close to 1.2 million
customers to Viacom's shareholders in an exchange offer (the "Exchange Offer")
that will reduce Viacom's debt obligations by $1.7 billion. Under the
transaction, such cable systems are valued at more than $2.25 billion, which
amount will vary due to closing adjustments for capital expenditures, working
capital and other items.
The Exchange Offer will permit shareholders of Viacom Inc. Class A and
Class B Common Stock ("Viacom Stock") to exchange such shares for shares of
cumulative, redeemable, exchangeable preferred stock of a subsidiary (the
"Subsidiary") of Viacom through which Viacom owns and conducts its cable systems
business. Consummation of the Exchange Offer is expected to result in the
redemption of approximately 3% of Viacom Stock. The ratio at which Viacom Stock
will be exchanged for cumulative, redeemable, exchangeable preferred shares of
the Subsidiary ("Preferred Stock") will be determined by dutch auction among
holders of Viacom Stock who choose to tender their shares in the Exchange Offer.
The range within which bids to exchange will be made will be determined by
Viacom. The exchange ratio of Preferred Stock to Viacom Stock in the Exchange
Offer will permit holders of Viacom Stock to receive a premium (capped at 12
1/2%) to the market price of Class B shares of Viacom common stock at the time
of such exchange. Upon completion of the Exchange Offer, the Preferred Stock
will be issued at an aggregate par value equal to the value of the cable systems
(after closing adjustments and debt), estimated to be in excess of $550 million
at the time of the Exchange Offer.
Also on July 25, 1995, Viacom, the Subdidiary ompany and
Tele-Communications, Inc. ("TCI") entered into a definitive agreement providing
for the sale of the Subsidiary to TCI, pursuant to which TCI will make a capital
contribution of $350 million to the Subsidiary in exchange for all of the common
stock of the Subsidiary. The sale will take place immediately after the
completion of the Exchange Offer. Five years after such sale and Exchange Offer,
the Preferred Stock will become exchangeable for TCI Class A Common Stock ("TCI
Stock"), at the option of the holders of the Preferred Stock.
National Amusements, Inc., the parent company of Viacom, will not
participate in the Exchange Offer.
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Consummation of the Exchange Offer and the related transactions is subject
to certain regulatory approvals and other conditions, including among other
things, (i) approvals of local franchise authorities, (ii) expiration or
termination of the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, and (iii) the satisfaction of Viacom with the federal
income tax treatment of the Exchange Offer and the transactions related thereto.
A copy of the press release issued by Viacom, dated July 25, 1995, relating
to the above-described transaction is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
Viacom and TCI have agreed to settle the antitrust action commenced by the
Company on September 23, 1993 against TCI and certain of TCI's affiliates in the
District Court for the Southern District of New York (Viacom International Inc.
v. Tele-Communications, Inc., et. al., Case No 93 Civ. 6658 (LAP)), subject to
certain conditions, including, among other things, the effectiveness of a new
affiliation agreement covering TCI's long-term carriage of Showtime and The
Movie Channel and the consummation of the cable transaction described above.
Item 7. Financial Statements and Exhibits.
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(c) The following exhibit is filed as part of this report on Form 8-K:
99.1 Press Release issued by Viacom Inc. dated July 25, 1995.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
VIACOM INC.
Date: July 25, 1995 By: /s/ Michael D. Fricklas
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Name: Michael D. Fricklas
Title: Senior Vice President,
Deputy General Counsel
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EXHIBIT INDEX
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Exhibit No. Description
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99.1 Press Release issued by Viacom Inc. dated July 25, 1995