KIRKLAND, Wash. — McCaw Cellular Communications Inc. said today it is boosting by more than $800 million its bid for shares of LIN Broadcasting Corp., which has resisted its advances by agreeing to merge with BellSouth Corp.
In its latest offer, McCaw, the country's largest cellular communications company, said it is now seeking 22.5 million LIN shares at $150 each, up from 22 million at $125 each.
McCaw said the new offer hikes the value of the nation's No. 7 cellular company to about $7.5 billion from its previous bid, which valued all of New York-based LIN at about $6.7 billion.
LIN is coveted for its valuable cellular franchises in such lucrative markets as Los Angeles, Dallas, New York and Philadelphia.
McCaw said that as soon as possible after completion of the offer, it would cause LIN to buy $425 million of McCaw Class A common stock and distribute it as a dividend in which non-McCaw shareholders would receive $16.17 of the stock for each LIN share retained.
McCaw said it has pledged to pay 12% annual interest to tendering LIN shareholders should its tender close after March 31.
Kirkland, Wash.-based McCaw said it requested an opportunity to respond to any improved offer from BellSouth before LIN enters into any revision of its deal with BellSouth.
McCaw now owns 5,089,500 LIN shares, and the shares it is offering to acquire represent about 46% of the fully diluted LIN shares not already owned by McCaw.
A successful offer would give McCaw slightly over 50% of LIN on a fully diluted basis, the company said.
McCaw said if BellSouth should respond to the new offer by sweetening its bid, it would ask LIN to put both offers up for a vote at the Jan. 12 shareholders' meeting called to consider the present BellSouth transaction and remove defensive measures.
McCaw said if LIN were to agree to a vote on its offer and a removal of defenses, McCaw would agree to extend its tender to the date of the meeting and abide by the shareholder vote.
"In the absence of such action, we intend to take our case directly to the LIN stockholders through a consent solicitation relating to the replacement of a majority of the LIN board," McCaw said.
McCaw said its amended offer assumes that LIN will continue with its plan to buy the 46% interest in New York City cellular telephone operations now held by Metromedia Inc. for $1.9 billion.