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S.D. Evangelist Gets OK to Buy Bakker's PTL Cable Network : Deal: At $7 million, Morris Cerullo outbid Oral Roberts for the bankrupt holdings. He also plans to buy Heritage USA theme park for $45 million.

June 01, 1990|CHRIS KRAUL | SAN DIEGO COUNTY BUSINESS EDITOR

SAN DIEGO — A bankruptcy judge Thursday approved the sale of the PTL cable television network to San Diego evangelist Morris Cerullo for $7 million.

Cerullo, a 58-year-old faith healer whose Worldwide Evangelism ministry outbid fellow evangelist Oral Roberts' $6.3-million offer for the network and production facility, also signed a contract to buy the other portion of Jim Bakker's scandal-plagued and bankrupt empire, the 2,200-acre Heritage USA religious theme park, for $45 million.

PTL trustee Dennis W. Shedd said he recommended that the Columbia, S.C., court accept Cerullo's bid because it was part of a $52-million package offer for the network and the theme park, the only comprehensive deal Shedd received. Under terms of the deal, Cerullo must put up a $1-million bond during the next 10 days and close on the land portion by late August.

Cerullo can back out of the land deal before making the $1-million down payment and still retain ownership of the network, Shedd said. The PTL cable network includes a broadcast production studio, a satellite "uplink," or earth-to-satellite transmission facility, and a leasehold interest in a cable TV satellite controlled by HBO.

The cable network is accessible to 800 cable TV systems and can reach 6.5 million homes, Shedd said. Although the PTL network no longer produces religious shows, such as the defunct "Jim and Tammy Show" that featured Bakker and wife, Tammy, the network rents out broadcast time to other evangelists, including Cerullo.

Shedd said Cerullo plans to maintain the network headquarters at the Heritage USA park situated near Ft. Mill, S.C., 15 miles south of Charlotte, N.C. Shedd said Cerullo also said that he intends to reopen the Heritage USA theme park, which has been closed since last September.

Of the Heritage USA park's 2,200 acres, only about 500 are developed. The park now includes a 500-room hotel, another hotel of the same size under construction, a water slide, a shopping mall and miniature railroad.

Cerullo's Worldwide Evangelism said in a statement that it planned to develop a "five-star seminar and conference center as well as a recreational vehicle resort and various housing projects" on the Heritage USA site. Cerullo was unavailable for comment Thursday.

Worldwide Evangelism, which was founded by Cerullo in 1961, produces a daily TV program called "Victory with Morris Cerullo" that is carried by 40 stations nationwide. The show is also broadcast in Canada, and Worldwide Evangelism has operations in other foreign countries, including Great Britain, the Philippines and Zimbabwe.

Cerullo is perhaps best known around San Diego for grandiose but abortive real estate schemes. He bought a downtown landmark, the 250-room El Cortez Hotel, in 1978 and announced plans for an evangelism training center. But he closed the center after two years of operation and sold the hotel.

Cerullo's church also bought 230 acres in north San Diego and announced plans to develop a religious retreat and housing development. But he ended up selling the land to home builder Pardee Construction. Plans for a condominium development to capitalize on the 1982 World's Fair in Nashville also fizzled.

In his two years of operating the El Cortez, Cerullo was involved in a number of financial disputes with evangelical students, contractors and real estate brokers. He also came under criticism in the early 1980s when it became known that trust funds from donors who were promised lifetime income for their donations were being invested in risky second- and third-trust deeds.

In a statement issued Thursday, Worldwide Evangelism said it is now "governed by a seven-member board of directors and has been audited for the last seven years by Arthur Andersen & Co.," a certified public accounting firm.

PTL has been under control of the bankruptcy court since June, 1987, two months after Jim Bakker resigned the ministry following a sex-and-hush-money scandal involving former church secretary Jessica Hahn. Upon leaving PTL, Bakker turned the ministry over to Jerry Falwell, who placed it in bankruptcy and turned financial records over to the U.S. Department of Justice.

Bakker's empire was brought down by revelations that he had sex with Hahn and then made payments to her to hush up the incident. Bakker also allegedly deceived investors who paid money for lifetime "partnerships" at the Heritage USA park, allegations that led to his conviction last year on conspiracy and fraud counts. Bakker is serving a 45-year sentence in federal prison.

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