Fadeout looms for FNN operations: CNBC's offer gains edge over Dow-Westinghouse's.

Fadeout looms for local FNN operations

The closure of Financial News Network facilities in Los Angeles appeared likely last week, after a U.S. bankruptcy judge decided the financially ailing network will be sold to its competitor, CNBC.

Judge Francis Conrad, however, gave the Federal Trade Commission until April 19 to file any antitrust complaints it has about the deal. The FTC investigation, on whether the sale unfairly eliminates competition in the market, is the only thing now preventing the CNBC purchase from becoming final.

A joint venture group formed by Dow Jones & Co. and Westinghouse Broadcasting Co. (Group W) has been involved in a bidding war with CNBC for FNN.

"We feel the court will ultimately rule in favor of competition," said Cheryl Daly, vice president of public relations at Group W Satellite Communications. "We feel this is not conclusive. This is not over."

She said Group W expects the FTC to find there are antitrust problems inherent in the CNBC deal.

FNN employees in Los Angeles had said earlier that they were hoping Group W would win the bidding battle because it might keep their facilities open while CNBC had pledged to merge the competing stations, likely closing the West Coast office and laying off its employees.

But FNN senior anchor bill Griffeth said he had recently heard that "Dow Jones was busy looking at Stamford, Conn., or Manhattan if they bought us."

"Both sides are going to shut us down," said Griffeth. "I know the judge is out to get the best dollar for creditors."

At a court hearing April 3, CNBC matched Group W's latest offer of $115 million. Conrad then told Group W to extend its bid until May 31, when the CNBC offer expires.

"You'll be on the hook until May 31," Conrad said.

But joint venture group refused, saying its offer expired April 3. Conrad then awarded the purchase to CNBC. "We feel FNN could significantly deteriorate in that period (April 3 to May 31)," Daly explained.

FNN would not comment last week on Griffeth's contention. FNN spokeswoman Amber Gordon said only that the cable business station "will be pleased to abide by the ruling of the court."

Group W has studio facilities in Stamford and Dow Jones has offices in Manhattan. But Daly said the joint venture group has made no decisions about where its FNN studios would be, only that the station would continue to exist.

CNBC is a subsidiary of General Electric Co.'s National Broadcasting Co. network. It reaches 16 million U.S. households.

NBC Vice President of Corporate Communications Joe Rutledge said April 3 "was a very good day for NBC." He added that he is confident the FTC's concerns will be eliminated and the sale will become final.

FNN reaches 35 million homes in the United States and Canada. It is 46 percent owned by Infotechnology Inc., which also has filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code.

Infotech controls 97 percent of United Press International, the wire service. Infotech and FNN own 51 percent of the Learning Channel, an adult educational cable network, which they are selling to the Discovery Channel.