PITTSBURGH, Nov. 22 -- Westinghouse Electric Corp. announced Wednesday it will close its $5.5 billion takeover of CBS Inc. Friday in a deal that will make Westinghouse the nation's largest broadcaster. The transaction received its final regulatory approval Wednesday from the Federal Communications Commission on a 5-0 vote. 'We applaud the FCC's fast action in approving Westinghouse's pending acquisition of CBS,' said Michael Jordan, chairman and chief executive officer of Westinghouse. 'It has taken less than four months -- from the Aug. 1 announcement of our intent to acquire CBS through the FCC's approval today -- to be in a position to complete this important transaction. 'Today's ruling is the culmination of the long hours and hard work of everyone involved.' When the acquisition is finalized, Westinghouse will own 15 television stations and 39 radio stations as well as the CBS network. Some of the stations may have to be sold unless Congress passes legislation further deregulating the broadcasting industry. The FCC agreed to waive temporarily the rules that limit national ownership of TV stations to 12 stations or 25 percent of the national audience. Combined, the new company will own stations that reach 33 percent of the U.S. market and will not have to sell them if a pending telecommunications deregulation bills clears Congress and is signed into law. The FCC vote was delayed by last week's partial government shutdown. Westinghouse has agreed to pay $1 million a day in interest to CBS shareholders for each day since Aug. 31 until the deal closes.
As a result, Westinghouse's payout to CBS shareholders will be $82.065 per share rather than the original $81. Shareholders of CBS approved the deal last week with 98 percent voting in favor. Westinghouse has not yet announced the name and management structure of the combined company. Jordan said last week CBS would be the name of the new broadcasting unit and that its 'eye' logo will not be changed. Pittsburgh-based Westinghouse also pledged the new CBS operations will maintain headquarters in New York. Westinghouse managed to dispel some resistance to the CBS buyout several weeks ago by agreeing to boost the amount of educational children's programming to three hours per week. That prompted three groups -- the United Church of Christ, Black Citizens for Fair Media and the Center for Media Education -- to withdraw a petition to the FCC to block the deal. CBS also has been hit with eight shareholder lawsuits in New York alleging the price being paid by Westinghouse is too low. But most analysts believe Westinghouse is paying top dollar for CBS. CBS stock was up 50 cents to $82 a share in mid-session trading on the New York Stock Exchange on Wednesday. Westinghouse was up 25 cents to $16.125. Pittsburgh-based Westinghouse has been selling off assets to cut debt and finance the buyout of CBS. Jordan has stressed in recent months Westinghouse plans to be a major player among the media giants and pledged that broadcasting will contribute 50 percent of the merged company's operating earnings within two years. Broadcasting and media account for the fastest-growing and most profitable segment of Westinghouse. The TV network has been in a ratings slump since 1992. CBS also took a beating last year with the loss of eight affiliate stations and its NFL games to News Corp.'s Fox Broadcasting.