UPI RECEIVES AT LEAST 4 BIDS FOR COMPANY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00965R000402810002-8
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 22, 2016
• Document Release Date: January 10, 2012
• Sequence Number: 2
• Publication Date: September 17, 1985
• Content Type: OPEN SOURCE

Declassified in Part - Sanitized Copy Approved for Release 2012/01/10: CIA-RDP90-00965R000402810002-8
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ARTICLE EARED
ON PAGE_
WASHINGTON POST
17 Se?tember 1985
UPI Receives at Least
4 Bids for Company
By Nell Henderson
Washington Post Staff Writer
At least four potential bidders for
United Press International, includ-
ing the wire service's employe
union, met yesterday's deadline for
submitting expressions of interest
to UPI.
The Wire Service Guild, an In-
diana publisher, a Houston devel-
oper and a former CIA official were
identified as expressing an Interest
in buying the wire service, which
has operated since April under pro-
tection of the federal bankruptcy
code. None of the potential buyers
specified the amount or terms of
any possible offers.
UPI Chairman Luis Nogales said
yesterday that he was encouraged
by the "numerous expressions of
interest" received from "various
parties," but would not identify
them.
However, the wire service re-
ported the names of three interest-
ed parties: Buert SerVaas, c air-
man of Curtis Publishing Co. m n-
dianapolis; Joe Russo, c airman
of The, Russo Cos., a real estate
ve nt concern in
Houston; and Max Hugel, the CIA's
:
former chief of covert operations
The Wire Service Guild also
stepped forward to announce its
own bid.
14 i ni t last night was the for-
mal deadline for potential buyers to
submit "expressions of interest"
identifying themselves and their
qualifications for operating the 78-
year-old wire service. However,
UPI spokesman William Adler said'.
the cutoff date was "not set in
stone" and that other bids may
come in this week. '
UPI sent out about 30 prospec-
tuses, or reports detailing the com-
pany's financial condition and com-
petitive strategy, to potential bid-
ders, Adler said.
A "substantial number" of those
parties have followed up with for-
mal expressions of interest, he said.
Adler said more than the four bid-
ders who were identified had made
submissions.
UPI's investment advisers, work-
ing with an investment adviser se-
lected by the union, will review the
latest responses and meet with po-
tential buyers to answer questions
and assist them in preparing "de-
finitive bids,* which will be due in
early October, said UPI spokesman
David Wickenden.
Bear, Stearns & Co., represent-
ing UPI management, is working
with Ladenburg Thalmann & Co.,
selected by UPI stockholders, as
UPI's joint investment adviser. The
Wire Service Guild's investment
adviser is Brian Freeman, who suc-
cessfully represented Trans World
Airlines unions in their fight against
Texas Air Corp.'s bid for TWA.
The Guild, representing 750 UPI
employes, said it submitted a bid to
buy UPI on behalf of the company's
union members.
The union, an affiliate of The
Newspaper Guild, would not dis-
close the proposal's terms.
The union's proposal would in-
volve a purchase of UPI "either by
the employes alone or in a joint ven-
ture with one or more purchasers,"
according to a statement released
yesterday.
"The proposal reflects the con-
tinuing commitment of the guild
employes, demonstrated by their
many past sacrifices, to a strong,
dependable, efficient and viable or-
ganization and system; the union
said.
Last year the union accepted con-
tract concessions including a 25
percent pay cut, which has been
partly restored, but it has resisted
further concessions requested by
management.
Freeman has argued that volun-
tary wage cuts are capital contri-
butions to a company, which endow
the union with certain equity rights.
SerVaas said that he is a member
of a previously unidentified investor
group, represented by Washington
attorney David M. Rubenstein, that
submitted a bid July 1. The group's
offer, valued at between $13.9 mil-
lion and $17.9 million, received no
formal response and was allowed to
expire July 15.
SerVaas said the group has sub-
mitted a new expression of interest,
but has not proposed a specific pur-
chase price this time. He would not
identify other members of the in-
vestor group.
With his wife, Cory SerVaas, Ser-
Vaas bought and revived the Sat-
urday Evening Post in 1971. He
said he would invest in UPI as an
individual, not on behalf of Curtis
Publishing.
He said he wants UPI to continue
as a "full-service agency" but that it
need not be a "mirror image" of the
Associated Press wire service. He
said UPI might differentiate itself
by developing "specialties" and pro-
viding more analysis of trends, but
he would not disclose details of the
group's business plan.
SerVaas said he would be willing
to discuss the possibility of giving
labor an equity stake in the compa-
ny but has not held any such discus-
sions with the union.
Declassified in Part - Sanitized Copy Approved for Release 2012/01/10: CIA-RDP90-00965R000402810002-8
 Declassified in Part - Sanitized Copy Approved for Release 2012/01/10: CIA-RDP90-00965R000402810002-8
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Russo, whose companies manage
a financial empire valued at about
$1 billion, is "extremely serious"
about acquiring UPI, said Russell
Rau, director of governmental af-
fairs for The Russo Cos.
The companies develop office and
commercial space and operate the
Ameriway financial services net-
work, which includes two banks, a
savings and loan, a mortgage com-
pany and a venture capital group.
Russo is assembling a group of
investors that includes individuals
with news experience, Rau said,
refusing to identify them.
Eugene Keilin, an investment
banker with the New York firm of
Lazard Freres who worked with
Freeman representing TWA's
unions, has been retained to repre-
sent Russo's group, Rau said.
Hugel, the former assistant CIA
director- urn - ew amps re=
businessman, sai recently e a so
panne to submit an otter, re-
porte .
Tr_ e1, chairman of Maxcell Te-
lecom Plus, a cellular telephone
company, and of ax u e nter-
prises, sai is group panne to
rove a mi ion to$ 10 mi ion in
o eratin g funs an im rove UPI's
marketing, but declined to speci y
the total amount o is possible of-
fer.
Declassified in Part - Sanitized Copy Approved for Release 2012/01/10: CIA-RDP90-00965R000402810002-8