US cable firms to get back together

NEW YORK - The struggle for control of Paramount Communications has prompted yet another realignment of America's cable and communications businesses with the announcement of the merger of two of the firms backing QVC's dollars 9.5bn bid for the studio, writes Larry Black.

The cable programmer Liberty Media, largest shareholder in QVC, will re-merge with its former parent, the giant cable operator Tele-Communications Inc, in a move that analysts say will substantially strengthen QVC's chances of success.

The all-share deal, worth about dollars 3.8bn, would reunite companies that split two years ago on concern about vertical integration in the cable television business. But it has already run into opposition. Late yesterday three class action lawsuits were filed in Delware Chancery Court, claiming shareholders would be 'deprived of the opportunity to maximise the value of their shares'.