Broadcasting Telecasting (Oct-Dec 1957)

FILM UA UNIT BUYS INTO AAP CORP. • United Artists buys 700,000 shares in $8.5 million deal • AAP president indicates defeat of move to sell to NTA United Artists Corp. announced Thursday that a newly-created subsidiary, Gotham Television Film Corp., has purchased 700,000 shares of the capital of Associated Artists Productions Corp. The price was $12 per share, or a total of $8.5 million, with $4.2 million ($6 per share) in cash, and the other half an undertaking for a sinking fund 6% debenture. There was no reference to litigation now pending over an earlier transaction in which National Telefilm Assoc. claimed acquisition of majority stock in AAP in a $7.5 million deal [Film, Nov. 18, et seq.]. Stated Robert S. Benjamin, UA's board chairman: "Appropriate legal steps are being taken to bring before the stockholders of AAP a plan by which each stockholder will be offered the same price upon the same terms." Mr. Benjamin's statement indicates that eventually UA can be expected to purchase additional shares. Outstanding shares in AAP as of mid-year totaled approximately 1.6 million. The new development brought a victorious-sounding message from Eliot Hyman, president of AAP, who is known to have been against the move to sell to NTA by Louis Chesler, board chairman; Maxwell Goldhar, a director, vice president, secretary and treasurer, and M. MacSchwebel, a director and vice president. These three men comprised an "executive committee" of AAP. Mr. Hyman announced that the trio, whose interests in AAP reportedly were included in the sale to UA, had resigned as officers and directors. (There was no breakdown in ownership of the 700,000 shares.) He said that as president of AAP Corp. he is "primarily concerned with the wellbeing of the corporation and its stockholders. After a period of conflicting articles in the press relating to sales of this company and/ or stock owned by individual stockholders, I am happy to be able to set the record straight. "AAP Inc. will continue in business under its present management, from its same offices, and with its same staff." He noted that Gotham Television had purchased the 700,000 shares and said AAP is "delighted at the prospect of having the added experience of the executives of United Artists in furthering our activities and progress in the television and motion picture fields." He concluded his statement by wishing stockholders, "all members of our industry" and the public "a very happy and prosperous new year." Neither AAP nor UA would talk about the action now current in New York Supreme Court. NTA, a party to the action, also withheld comment. In that action, five minority AAP stockholders representing about 10,000 shares moved for a temporary injunction to stop the sale to NTA pending trial of the case. The plaintiffs claimed that Messrs. Chesler and Goldhar entered into a contract to sell 50% of AAP stock to NTA for cash, debentures and stock of NTA, even though a better contract for shareholders was offered by UA and was subsequently approved by AAP directors, but not submitted to the stockholders. They charged Messrs. Chesler and Goldhar with disregarding minority stockholder rights. Soon afterward, NTA entered the court with a cross-complaint revealing a damage suit for $200,000 each against UA, Arthur B. Krim, UA's president; Mr. Benjamin; Mr. Hyman; AAP's treasurer, Harry Zittau, and Vice President Ray Stark. NTA charged the defendants with "inducement to break a contract and unfair competition." At its latest hearing on the matter, the court asked the attorneys involved to file answering briefs. A brief rundown on each company involved: United Artists — It was formed in April 1919 by Mary Pickford, Douglas Fairbanks Sr., Charles Chaplin and D. W. Griffiths. After the (Robert) Benjamin-(Arthur B.) Krim management group took over UA in February 1951, the firm financed and distributed independently-produced theatrical films for some 49 independents. It now leases post1948 theatrical films to tv and plans tv production (UA-TV Inc.), publishes sheet music (UA Music Co.), turns out phonograph records (UA Records Inc.) and manages two Broadway theatres. The Benjamin-Krim group achieved a stock majority in 1952 after pulling UA out of the red, in 1955 bought out Charlie Chaplin and in 1956 acquired Miss Pickford's share of the company stock. (For the latest UA venture, see page 50.) AAP Corp. — It operates AAP Inc., Associated Artists Enterprises (merchandising) and Dominant Pictures Corp. as whollyowned subsidiaries, has tv rights and distributes "Popeye" cartoons acquired from Paramount Pictures, more than 800 Warner Bros, features, additional libraries, "Looney Tunes" cartoons from Warner Bros., and has various other activities and rights dealing with motion picture distribution and reissue. NTA — This company has a multi-faceted operation covering network activity via NTA Film Network, station management (KMGM-TV Minneapolis, WAAT-AM-FM and WATV [TV] Newark), theatrical film distribution via NTA Pictures Inc. and coproduction with Desilu and 20th CenturyFox Corp. Roach Stock Offering Postponed Sharp drops in the stock market last Monday and Tuesday have prompted S. D. Fuller & Co., New York brokerage house, to postpone floating of the first public offering of stock by Hal Roach Productions until Jan. 15, it was learned last week. Financial de Paee 48 December 23, 1957 tails of the Roach tv operations were contained in an exclusive report a fortnight ago [Film, Dec. 16]. According to broker S. D. Fuller, the market fluctuations made last week an "inopportune time" in which to attempt a public sale. Guild Films Sales $15 Million For Record in 1957 — Kaufman In a year-end statement, R. R. Kaufman, president of Guild Films, revealed last week that sales to sponsors and stations exceeded $15 million during 1957, marking the most successful year in Guild Films history. "Regardless of general economic development, the television film industry should register further gains in 1958," Mr. Kaufman predicted. He said that although the year-end earning figure for Guild is not yet ready, the nine-month period recorded a net income after taxes of $616,000. Television sales included every one of 22 programs in the Guild Film catalogue, from its first musical, The Liberace Show, to its latest Safari series, The Michaels in Africa. Mr. Kaufman declared he is looking forward to an equally successful new year based on two new trends: (1) the continuing upsurge of spot television buying by advertisers and (2) the steady increase of program sponsorship by local and regional sponsors. Mr. Kaufman predicted 1958 will see the growing importance of comedy. He based this on the "enthusiastic" response Guild has had on its RKO Leon Errol comedy package, released to stations this month. In addition to The Michaels in Africa, now in production, Guild Films has completed its pilot on The Light of the World and plans are being readied for another production, Sabotage, to be produced in England. Williams to ABC Film Sales The appointment of Philip Williams, eastern spot sales manager of Ziv Television Programs, as vice president in charge of syndication sales for ABC Film Syndication, was announced last Thursday by George T. Shupert, president of ABC Film. Mr. Williams, who assumes his new position Jan. 6, succeeds Don L. Kearney, who has been named sales director for Corinthian Broadcasting Co. [Stations, Dec. 16]. Mr. Williams has served Ziv Tv for five years in various sales executive capacities. EarMR. WILLIAMS lier> he had be£n with Time Inc. 15 years, including sales assignments on Fortune and the "March of Time," and acting as director of advertising for the motion picture and television unit of the corporation. MGM Features in 86 Tv Markets Metro-Goldwyn-Mayer features now are being programmed in 86 tv markets, Dick Harper, MGM-TV's general sales manager, reported last week in a year-end "roundup" Broadcasting