Atlanta broadcaster Ted Turner yesterday rejected National Broadcasting Co. Inc.'s offer to buy half of Cable News Network, saying he could not "give NBC the total editorial control over CNN which they desired."
One source close to the negotiations said that Turner Broadcasting System Inc. was asking for $300 million and that NBC initially offered $200 million. An NBC spokeswoman said $250 million was in the "ballpark." A Turner spokesman would not comment.
Although he turned down NBC's offer, Turner will have to sell something to finance his $1.5 billion acquisition of MGM/UA Entertainment Co., financial analysts said.
Turner Broadcasting is holding discussions about selling part of CNN to a variety of parties, including Gannett Co. Inc., Time Inc. and media mogul Rupert Murdoch, a Turner spokesman said.
NBC, which is a subsidiary of RCA Corp., said its offer expired at 5 p.m. yesterday and would not be renewed. One of the conditions of the offer was that NBC News have total editorial control over CNN, said Mary Lou O'Callaghan , NBC's director of news information.
That demand was "a major sticking point" in Turner's decision, said Arthur Sando, a Turner spokesman.
"That's the kind of ultimatum that Adolf Hitler gave the Poles," Turner said yesterday, United Press International reported.
NBC said it "will continue to explore its own cable news intitiative." The company has "a timetable it is actively pursuing, and is looking at a possible start-up date of June 1986," O'Callaghan said. Arlington is one of several locations being considered for the operation's headquarters, she said.
About three weeks ago, NBC sent out details of its proposed cable news network to operators of major cable systems across the country. The company plans to ask the cable operators early next month to commit themselves to using NBC's service, O'Callaghan said. "We want to proceed on our own, with or without CNN," she said.
The threat of competition from NBC was considered to be one of the factors that may have led Turner to consider the offer, analysts said. But they added that the major factor was Turner's need for cash to finance his acquisition of MGM/UA Entertainment Co. Turner agreed in August to buy the company, which is based in Culver City, Calif., after the collapse of his drive to take over CBS Inc.
The agreement calls for Turner to sell United Artist's (UA's) assets immediately to Kirk Kerkorian for $470 million. Kerkorian is MGM/UA's largest stockholder, with 50.1 percent of the company.
Turner had offered $29 a share in cash for MGM/UA, but later revised his offer to $25 a share in cash and one share of a new issue of Turner preferred stock.
Viacom International Inc. said it is talking to Turner Broadcasting about buying some of MGM's assets, said John S. Reidy, an analyst with Drexel Burnham Lambert, a financial adviser to Turner.
Viacom is believed to be interested in acquiring 50 percent of MGM's Culver City production facilities, home video business and movie distribution business for about $300 million, Reidy said.
RCA's stock closed before Turner's announcement at $48, down 1/8, on trading of 373,400 shares. Turner Broadcasting stock closed at 16 7/8, up 1/4, on trading of 5,500 shares.