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Westinghouse turns dial
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November 13, 1996: 9:09 p.m. ET
Company to focus on media business, but will face stiff competition
From Correspondent Rhonda Schaffler
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NEW YORK (CNNfn) - Westinghouse Electric Corp. announced on Wednesday that it would spin-off its industrial business to shareholders and concentrate on its rapidly growing television and radio business.
The company said the $4.6 billion spinoff will create a new Pittsburgh-based company, which will keep the Westinghouse name, also known as Welco.
Westinghouse hopes the plan will unlock the value of its broadcasting business, which includes the CBS Inc. television network, Group W Satellite Communications Co., a cable television marketing and distribution company, and Infinity Broadcasting, a radio broadcaster that Westinghouse recently bought.
But as a media company it will find itself one of the smaller players in a game increasingly dominated by global giants.
The company's chairman and CEO, Michael Jordan, chose to be upbeat, however, and claimed the company was already off to a solid start.
New fall television shows with some old familiar faces, like Bill Cosby, have boosted CBS to the number two spot in the ratings and restored some luster to the Tiffany Network.
"We have made real progress in turning around the network performance," said Jordan.
He added that although he was encouraged by the results so far, "it will take a couple more years before we are back at number one."
Clearly, Westinghouse is still behind the eight ball. The new media company still doesn't have a name. It has no major studio alliance, little presence outside the United States, and no significant cable holdings.
Media Analyst David Londoner of Schroder Wertheim said that it isn't in the same league as the ABC contingent. (243K WAV) or (243K AIFF)
Westinghouse has set its sights on buying additional radio stations and wants to expand further into cable.
The company wouldn't comment Wednesday on rumors that it is interested in buying country music cable company Gaylord Entertainment.
Analysts say a deal like that would help unlock some of the value Jordan believes is hidden in Westinghouse stock.
Unfortunately, Westinghouse isn't exactly free to deal. The new media company will be born carrying $5.5 billion in debt. 
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