Broadcasting Telecasting (Oct-Dec 1963)

H&B, RKO GENERAL FORM CATV FIRM Will operate over 50 systems with 100,000 subscribers Honorary alumnus A helping hand from a commercial broadcaster has enabled the San Fernando Valley State College in Northridge, Calif., to have its own educational FM station, kedc-fm. Saul R. Levine, owner of kbca(fm) Los Angeles, learned that the educational institution had long wanted a station of its own, but was unable to get the necessary money from the state, so he donated a transmitter and antenna to the college and, in his professional status as an attorney, drew up the application papers filed with the FCC for the new station. A new, major entity in the community television field was in the making last week. Involved are RKO General and H&B American Corp., both already substantial CATV owners. After a stock transaction is consummated— -and this must wait FCC approval for one element of it — H&B American will own and operate over 50 CATV systems, serving 100,000 subscribers, with RKO General owning about 56% of H&B through its whollyowned subsidiary, Video Independent Theaters Inc., Oklahoma City. The transaction, announced last Thursday, proposes to turn over to H&B the RKO General CATV subsidiary, Vumore Inc., and a microwave relay subsidiary, Mesa Microwave Inc. In return, RKO General, which already owns 576,000 shares (20%) of H&B plus debentures totaling $500,000, will receive 1,550,000 shares of H&B. Mr. O'Neil H&B's capitalization will be increased from its present 4 million shares to 5 million shares of common voting stock, with both remaining at 10 cents a share par value. Vumore Inc. will be liquidated. Vote in December ■ H&B stockholders will vote on the deal at a stockholders meeting in December. Details of the transaction were submitted to the FCC last week. FCC approval is necessary for the transfer of Mesa Microwave, a common carrier relay which serves Vumore cable systems in Arizona. As part of the deal H&B can bor row up to $2 million from RKO General at 6% interest for expansion and modernization. In addition to its present 24 CATV systems with 70,000 customers, H&B is building four, and holds franchises for three more. Eleven States ■ H&B systems are in California, Alabama, Arizona, Colorado, Idaho, Iowa, Maine, Montana, New Jersey, New Mexico, Washington and New Brunswick, Canada. H&B also owns two microwave relay systems, H&B Microwave and H&B Communications Corp. The company grossed $4.45 million in the fiscal year ended July 1, and earned $1.4 million before depreciation, David Bright, chairman and president, said. It has a tax credit of $3 million from previous years' losses, he said. Last Thursday, following announcement of the RKO General-H&B American deal H&B American closed with a gain of 1.8 on the American Mr. Bright Stock Exchange, closing at 3V4. RKO General's Vumore operates 27 cable systems with 30,000 subscribers primarily in the Southwest. Vumore is a subsidiary of Video Independent Theatres Inc., Oklahoma City based chain of movie houses in the Southwest, which RKO General purchased in 1961 for over $4.5 million from the estate of the late Henry Griffin. Vumore and Mesa Microwave, Mr. Bright said, had sales of $2.2 million and net operating profit before depreciation and taxes of $1.16 million for the fiscal year ended July 31. NAB 'Future' committee to hold 3d meeting Pay television, community antenna TV and the FCC's UHF policy will be the major items of discussion Wednesday (Oct. 9) when the Future of TV in America Committee of the National Association of Broadcasters meets in Washington. The broad goal of the committee is to recommend to the NAB board new policies to be followed in all three of these areas. This will be the third meeting of the committee, under Chairman Dwight Martin of wafb-tv Baton Rouge, La., since it was formed last February. At its last session in June, the committee heard a detailed staff report on pay TV and directed the gathering of further material on the problem for consideration at this week's meeting. The committee is considering if NAB should change its opposition to pay TV over the air, or if it should be expanded to include wired systems. Discussions have been held on whether the NAB should retain an outside consultant for a major study of pay TV or whether a staff position should be created for this purpose. Two broadcast groups buy Coca-Cola franchises Coca-Cola bottling franchises have been acquired by two broadcasting groups. Wometco Enterprises, Miami, Fla., has announced an agreement to buy the Coca-Cola Bottling Works of Nashville, Tenn., in a multi-million transaction. The bottling company operates plants in Nashville, Lebanon and Springfield, Tenn., owns 50% interest in companies operating similar bottling works in Dickson and Columbia, Tenn., and has a royalty interest in a plant in 78 (THE MEDIA) BROADCASTING, October 7, 1963