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 Fox Makes $500 Million Investment In New World
 NEW YORK, May 23 /PRNewswire/ -- Fox Inc. and New World

Communications Group Inc. (Nasdaq: NWCG) jointly announced an unprecedented broadcasting alliance that results in the largest network affiliation realignment in television history and gives Fox Broadcasting Company a major boost toward its goal of becoming the leading network in the United States.
 The agreement calls for up to 12 VHF stations owned or to be acquired by New World eventually changing their network affiliations from ABC, CBS and NBC to Fox Broadcasting Company, and enables New World to realize its strategic objective of becoming a major force in television program production.
 The announcement links two companies which have made substantial commitments to the future of over-the-air free broadcast television and continues impressive momentum for the seven-year-old Fox network, which recently shook the more established networks with its acquisition of rights to broadcast the NFL's National Football Conference games during the next four years.
 At the same time, Fox and New World will work together to develop syndicated programming which will run on both the Fox and New World stations. Fox and New World will also work together in the development of primetime series and movies for the Fox Network.
 "This agreement will forever change the competitive landscape of network television," said Rupert Murdoch, Chairman and Chief Executive Officer of Fox Inc. "This is the greatest realignment of television station affiliations in the 60-year history of American broadcasting. We will be adding to the Fox network, 12 powerful VHF stations with the finest reputations for news and local programming in their major markets.
 "This is a giant step toward leveling the playing field and toward the longstanding public policy goal of achieving a fully competitive, fourth broadcasting network for America. The intended Fox affiliations will provide the 12 stations to be owned by New World with the opportunity to increase local programming, including local news, and the opportunity to achieve increased profitability through the sale of more local advertising availabilities.
 "With regard to our financial investment in New World, we believe it is a uniquely positioned station group with uniquely talented management, and we look forward to working closely with everyone there as it continues its growth as a major force in broadcasting."
 William C. Bevins, Chief Executive of New World, said: "With this strategic alliance, New World emerges as a leading syndicated program provider in a highly competitive marketplace. That, plus significant access to the Fox network for our series and movie programs, puts us in the leading ranks of television production companies.
 "As for our stations, they will benefit from a wider diversity of programming, heavier emphasis on local news and expanded news operations in each market, combined with the Fox network's creative entertainment programming and coverage of the NFL's National Football Conference games. The Fox network has created a better business plan for network affiliated television stations, and we are extremely pleased to affiliate with it."
 All five of New World's currently owned and operated VHF stations are switching to Fox affiliations. They include: WJBK-TV Detroit, WJW-TV Cleveland, WAGA-TV Atlanta, WTVT-TV Tampa, and WITI-TV Milwaukee.
 New World previously announced an agreement to acquire four stations from Great American Communications Corporation, pending Federal Communications Commission (FCC) approval. All four of those stations are intended to become Fox affiliates as well.
 New World has obtained an option to acquire debt and equity securities owned by DLJ Merchant Banking Partners, L.P., certain of its affiliates and certain other security holders of Argyle Television Holding Inc. Argyle currently owns four television stations which are located in Dallas, TX, St. Louis, MO, Austin, TX and Birmingham, AL. This option may be exercised no earlier than March 1995. Following exercise of this option, New World would have the right, subject to the necessary approvals of the FCC, to convert the securities acquired, and New World would acquire control of these four Argyle stations. If New World were to convert the securities and, after FCC approval, acquire control of the Argyle stations, it is contemplated that New World would then affiliate the Dallas, St. Louis and Austin stations with Fox.
 New World noted that it intends ultimately to acquire up to the maximum number of stations, currently 12, allowed under the FCC's Multiple Ownership Rules. New World said that it plans to sell, or transfer its options to buy, a sufficient number of stations involved in these transactions to keep New World in compliance with the FCC's rules.
 Fox is investing $500 million in New World, half of which is in exchange for non-voting preferred stock convertible to Class A common stock of New World at $12.92 per share. If Fox exercises its conversion privilege, it will own approximately 20 percent of the shares on a fully diluted basis after completion of the purchase.
 The balance of Fox's investment is represented by a new class of seven-year New World non-voting preferred shares redeemable over time, with warrants for the purchase of New World common stock attached. These securities will be purchased for an aggregate of up to $250 million as Fox station affiliations become effective. When fully issued, the warrants will entitle Fox to purchase, utilizing the preferred shares, up to 1,250,000 New World shares for $15 per share, and up to 4,625,000 shares for $50 per share.
 Fox said that after the transactions are completed and affiliation switches to Fox Broadcasting Company are completed, its station group will dispose of its stations in Dallas and Atlanta. Fox and New World have agreed to adjustments based upon the amount received by Fox for the disposition of these Fox stations.
 New World Communications Group Inc. consists of seven broadcast television stations: WJBK-TV Detroit, WJW-TV Cleveland, WAGA-TV Atlanta, WTVT-TV Tampa, WITI-TV Milwaukee, WSBK-TV Boston, and KNSD-TV San Diego. It also owns New World Entertainment, a production company which produced "The Wonder Years" and "Santa Barbara" television series; New World Sales and Marketing, a television advertising rep firm; Four Star, a film library; Genesis, a syndication company; and an ownership interest in Guthy-Renker, an infomercial production studio.
 -0- 5/23/94
 /CONTACT: Marcia Horowitz of Howard J. Rubenstein Associates, Inc., 212-489-6900, for Fox, Inc.; Dennis Petroskey of Fox, Inc., 310-203-1755; Jim Conroy of New World Communications Group, Inc., 212-572-5980; or Joele Frank of Abernathy MacGregor Scanlon, 212-371-5999, for New World/

CO: Fox Inc.; New World Communications Group Inc. ST: California, New York IN: ENT SU:

CB-PS -- NY017 -- 9267 05/23/94 10:03 EDT
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Publication:PR Newswire
Date:May 23, 1994

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