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Viacom eyes wax museum
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September 24, 1998: 4:29 p.m. ET
Media giant expresses interest in Pearson property amid Simon & Schuster sale
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NEW YORK (CNNfn) - Viacom Inc. has expressed interest in Pearson Plc's Tussauds Group, which owns one of London's busiest tourist attractions -- the world-famous Madame Tussaud wax museum.
Although there have been preliminary talks between the two media conglomerates, there's no guarantee an agreement will be reached.
"We're not at the end of the process," said Peter Warner, investment banker at Lazards Brothers, who is advising Pearson on the possible sale.
Pearson officials didn't return telephone calls. Viacom had no immediate comment.
If the deal happens, the Tussaud brand name can be incorporated into Viacom's Paramount Parks subsidiary, which operates theme parks including Kings Dominion in Richmond, Va. and Great America in Santa Clara, Calif.
Tussauds Group owns the United Kingdom's largest theme park as well as the wax museum. And the group has broken ground on a new site in Times Square, New York.
Talk of a sale of Tussaud comes amid Pearson's pending $4.6-billion acquisition of Viacom's Simon & Schuster assets. In May, the London-based media concern (which also owns "the Financial Times" and Penguin Publishing) agreed to acquire Simon & Schuster's education and reference divisions. The deal is still expected to close in October.
By July, Pearson, in turn, reached an agreement to sell the reference division to Dallas-based investment firm Hicks, Muse, Tate & Furst Inc. for $860 million. And to help hold down its own debt levels, Pearson on June 23 announced that it would consider offers for Tussauds Group.
In the midst of closing on the Simon & Schuster sale, Viacom has studied the possibility of making a bid, a person familiar with the situation said.
However, at least one analyst warned against reading too much into the preliminary talks.
"Looking at it is one thing. If a property is tangentially related, they'll look at it. But that doesn't mean they are all serious about it," said David Londoner, media analyst at Schroder & Co.
"It doesn't mean anybody's talking," Londoner said.
For its six-month interim report, Tussauds Group recorded operating profits of 2.4 million pounds on sales of 44.7 million pounds.
-- by staff writer Robert Liu
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