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ABC plans move to Disney
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June 24, 1998: 1:03 p.m. ET
ABC Inc. will move 300 to 400 staff from NYC to Burbank in June 2000
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NEW YORK (CNNfn) - ABC Inc. plans to move nearly 10 percent of its New York-based employees in June 2000 from the network's headquarters in Manhattan to the home base of its corporate parent, Walt Disney Co., in Burbank, Calif., CNNfn has learned.
The move is expected to involve 300 to 400 people, who will relocate to a new building adjacent to other Disney properties in Burbank, according to a letter sent Monday to all ABC employees by Robert Iger, the president of ABC Inc., and obtained by CNNfn.
Iger said the headquarters and roughly 90 percent of the company's employees -- or about 4,300 people -- will remain in New York.
Julie Hoover, an ABC spokeswoman, said an unknown number of additional ABC employees, mostly on the television side, will move from a site in Century City, Calif., to Burbank.
ABC Inc., purchased by Disney in 1996 as part of its $19 billion takeover of Capital Cities/ABC Inc., includes the ABC TV Network, several dozen television stations and shares in five cable channels, including ESPN.
The division's corporate headquarters in New York oversees a sprawling network operation that includes employees in a cluster of buildings near Central Park on Manhattan's Upper West Side, and on West End Ave., site of most of the division's radio studios.
Iger described the decision as the outcome of 2-1/2 years of brainstorming with Michael Eisner, Disney's chairman and chief executive officer, over how to enhance the give-and-take between ABC Inc. and its owner.
"In terms of working together efficiently and synergistically, we believe we have achieved a great deal," Iger wrote. "But to go to the next level, we think it is important to relocate some of our employees to Los Angeles."
Still unknown who will make move
Iger said in his letter that he and Eisner would consult with mangers in each ABC department over the next six months to determine which areas and positions will be affected.
The Walt Disney Co. is the world's second-largest media conglomerate after Time Warner, the parent company of Turner Broadcasting System, which owns CNN and CNNfn. Disney has interests in TV and movie production, theme parks, publishing companies, and professional sports franchises.
When Disney initially purchased Capital Cities/ABC, there were concerns in some industry quarters that the creator of Mickey Mouse would crimp the autonomy of ABC's venerable news division. Hoover said Wednesday that a larger share of entertainment employees were likely to move to Burbank than staffers in ABC's news and radio departments.
Analysts portrayed the coast-to-coast move as a matter of sheer pragmatism. Many top ABC executives routinely shuttle back and forth between California and New York, presumably at high cost to the company.
Iger said in his letter that some of the firm's senior-level employees will maintain offices on both coasts after the move, as he himself does.
They are trying to get things "consolidated under one roof," said Edward Hatch, an analyst with UBS securities who follows Disney. "I think one of the reasons Disney bought Cap Cities and ABC is because they shared similar philosophies and cultures in terms of costs and the way they operated."
Disney officials could not immediately be reached for comment.
Disney had sales of $22.47 billion in its last fiscal year, ended in September 1997. Shares of the company(DIS) were up 1-1/16 at 110-13/16 in composite trading on the New York Stock Exchange at midday Wednesday.
--by staff writer Douglas Herbert
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Disney
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