3 INSURERS' TV HOLDINGS PUT THEM IN LINE TO GAIN FROM ABC, CBS SALES

3 INSURERS' TV HOLDINGS PUT THEM IN LINE TO GAIN FROM ABC, CBS SALES

Three insurance companies with significant broadcasting subsidiaries stand to benefit from the recent megadeals involving CBS and ABC, an insurance analyst said.

The sale of ABC to Disney for $19 billion and CBS to Westinghouse for $5 billion earlier this month has boosted the broadcasting assets of Jefferson Pilot Corp., Liberty Corp. and AFLAC, said Gloria L. Vogel, senior analyst at Ladenburg, Thalmann & Co. in New York.The increase in value has helped two of the companies' stock prices, she said. Since Ms. Vogel surveyed the three companies Aug. 7, AFLAC's price went

from $41 to $42.50 as of midday trading on the New York Stock Exchange Tuesday.

Similarly, Jefferson-Pilot's stock price went from $55.25 to $58.25. However, Liberty's decreased slightly from $31.25 to $31, also on the New York Stock Exchange.

Officials at the companies were unavailable for comment at press time Tuesday.

"A lot of people are not even aware these companies have these assets," Ms. Vogel said Monday. However, she said, the stations are expected to grow in value "given the hot acquisition activity and limited number of stations available."

The three insurers have several things in common - they are mid-level life/health insurers based in the southern U.S., as are their television affiliates. Jefferson-Pilot also owns a number of radio stations, including properties in Atlanta, Denver, San Diego and Miami.

"All of a sudden we have a shortage of these (television) properties and, given the rules of supply and demand, the value has probably gone up," Ms. Vogel said. "These stations are all in secondary markets but are doing well in those markets."

Ms. Vogel was not surprised all three companies handled health and life insurance.

Life/health insurance is a "more even cash-flow type of business than property/casualty," she said.

Jefferson-Pilot, based in Greensboro, N.C., operates three TV stations and radio station groups that create, produce and distribute programming. Communications operations, including stations in Charlotte, N.C., Charleston, S.C., and Richmond, Va., contributed $172.5 million in revenue in 1994 and $36.2 million in pretax income, or about 10.4 percent of the company's pretax 1994 income, Ms. Vogel said.

For the first six months of this year, communications contributed $11.3 million in operating income, or about 11.4 percent of Jefferson-Pilot's total income.

The eight television stations in Louisville, Ky., Biloxi, Miss., Toledo, Ohio, and elsewhere that are owned by Liberty Corp. of Greenville, S.C., have had a similar positive effect on the bottom line.

"Six of the TV stations were ranked number one in their markets," Ms. Vogel found. In the first quarter of this year, revenue were $24.8 million or 17.3 percent of total revenue. The broadcasting pretax income of $6.7 million was 41.8 percent of the company's total in the first quarter.

AFLAC, of Columbus, Ga., has seven TV stations in Missouri, Alabama, Iowa, Louisiana, Georgia and North Carolina. In 1994 they contributed $77 million in revenue, $26.8 million in operating cash flow and $23.2 million to operating income. Pretax earnings totaled $17.2 million of the corporations's $504.3 million, or 3.4 percent.