Time Inc.'s chairman Friday defended a proposed $14 billion buyout of Warner Communications Inc. at Time's annual meeting and attacked as "cynical" Paramount Communications Inc.'s $12.2 billion offer for Time.
"We are trying to bring this merger of Time and Warner together as quickly and expeditiously as we can . . . and legally," J. Richard Munro told about 1,100 shareholders who crammed the Grand Ballroom of the New York Hilton.Munro said Time's directors felt the long-term benefits of the Time-Warner marriage outweighed the "inadequate and cynical" $200-a-share tender offer from Paramount.
"They've refused to be stampeded by short-term speculators," he said.
In response to questions, Munro said Time had no plans to cut its 25 cent quarterly dividend after buying Warner and added Time does not expect to issue a special dividend to shareholders in connection with a Warner acquisition.
The annual meeting, originally set for June 23, was called to re-elect four directors to Time's 12-member board, including Munro and Time President Nicholas J. Nicholas Jr. Also standing for re-election were Time Vice Chairman Gerald M. Levin and Donald S. Perkins, an outside director.
The four officers were re-elected by a 74 percent majority of votes cast, or 55 percent of Time's 57 million shares outstanding. Time has about 61 million shares outstanding on a fully diluted basis.
Missing from the agenda was a vote on the Time-Warner pact. Unlike a prior deal in which the two companies agreed to merge through a stock swap, the revised merger does not need shareholder approval and is almost irreversible.
A Delaware Chancery Court judge Wednesday denied a motion to delay the meeting, filed by three sizable Time shareholders disgruntled about shareholders' lack of a voice. If the suit had succeeded, the shareholders could have nominated candidates to oppose the Time directors up for re-election.
Before the meeting, several shareholders expressed frustration over the turn of events since early June, when Paramount launched its unsolicited offer.
One woman, who asked not to be identified, described the behavior of Time's board as "arrogant." She said Time stockholders already had waited too long for increased share value.
Two other Time shareholders complained about the inflexibility of the Time-Warner arrangement. "They've shot themselves in the foot. I want my money," one said, referring to the immediate cash in Paramount's offer.
In Washington, the United Shareholders Association urged Time's board to reconsider its decision not to allow shareholders to vote on either the Time-Warner merger or Time's rejection of Paramount.
Meanwhile, a federal district court denied a request by Casselberry, Fla., for a preliminary injunction to halt Paramount's bid without first receiving proper regulatory approvals.
A takeover of Time would give Paramount majority ownership of American Television & Communications Corp., an 82 percent-owned Time subsidiary that runs Casselberry's cable system. The suit had charged the takeover would violate the city's right to approve ownership changes for its cable franchise.
"We are gratified by the U.S. court's prompt decision," Paramount said.