Viacom Buys Remaining Stake of UPN

Updated from 3:42 p.m. EST

Viacom (VIA Quote) said Monday that it had acquired the interest in the UPN broadcast network that it didn't already own, buying out partner Chris-Craft Industries for $5 million.

The deal was expected, given that a New York court ruled Thursday that BHC Communications(BHC Quote), the publicly traded subsidiary of Chris-Craft that actually owned UPN with Viacom, either had to sell its share of the network to Viacom, or buy Viacom out. The $5 million price tag had been set under the terms of a buy-sell provision Viacom triggered in February to end its partnership in UPN as it completes its pending merger with CBS (CBS Quote).

"While we were disappointed with the court's decision, we believe that UPN and our shareholders will now be best served by ending any further uncertainty through our sale to Viacom," said William D. Siegel, president and chief operating officer of BHC, in a statement. Chris-Craft has not severed all of its ties to the fledgling network with Monday's announcement; the company still owns eight UPN affiliates.

BHC stock benefited from the news, rising 7 13/16, or 5%, to close at 164 7/8 Monday. Viacom fell 5/8, or 1%, to 55 7/8.

The network has been a money loser -- reportedly some $800 million -- for most of its five-year existence, but it began gaining momentum during the 1999-2000 season, mostly on the ratings strength of its weekly dose of World Wrestling Federation (WWFE Quote) programming. The network has begun to build a strong following among young men, a coveted demographic among advertisers.