DATE: Thursday, September 4, 1997           TAG: 9709040474

SECTION: BUSINESS                PAGE: 1D   EDITION: FINAL 

SOURCE: BY LON WAGNER, STAFF WRITER 

                                            LENGTH:   66 lines

IFE, FOX KIDS TO SEAL DEAL TODAY THE MERGER WILL BENEFIT TOP EXECUTIVES BUT MEAN LAYOFFS FOR DOZENS OF WORKERS.

International Family Entertainment Inc. and Fox Kids Worldwide Inc. expect today to complete their $1.9 billion merger. The deal will result in the loss of one-third of IFE's area employees and lucrative employment guarantees for top executives.

For the record, Virginia Beach-based IFE will be ``the surviving corporation,'' but Fox Kids will be running the show.

IFE has given layoff notices to 45 of its Virginia Beach-based workers, most employed in finance, information services and marketing jobs. Another 43 marketing and finance department employees ``were placed on what we're calling `transition,' '' said Larry W. Dantzler, chief financial officer.

The transition for those 43 workers is expected to take about six months, at which time their positions will be relocated to Fox Kids' operations in Los Angeles, Dantzler said. Some of those workers may be offered jobs in California.

IFE would not say what kind of severance arrangements were made with employees.

The fate of those workers - 88 of IFE's 275 area employees - contrasts with how the company's senior executives fared in Fox Kids' June 11 buyout of IFE.

Just days before the merger was announced, IFE signed employment contracts with four top executives who will be paid millions each if they are fired after Fox Kids takes over, according to Securities and Exchange Commission documents.

On June 1, IFE negotiated five-year employment contracts with Dantzler (base salary of $350,000); general counsel Louis A. Isakoff ($350,000 base); Family Channel programming president K.J. ``Gus'' Lucas ($450,000 base); and advertising sales president Richard L. Sirvaitis ($460,000 base).

The contracts call for minimum annual pay increases of 5 percent and annual bonuses of between 20 percent and 33 percent, the SEC filing says. IFE will also pay Sirvaitis a $525 monthly car allowance and $7,200 a year in health and country club dues, according to the filing.

IFE founders Pat and Tim Robertson benefited by owning a controlling interest in the company. Their 6.5 million shares brought in $227 million. CEO Tim Robertson's shares fetched more than $95 million. Much of the $134 million Pat Robertson got from the sale will go to Christian Broadcasting Network in 2010 and to his children other than Tim.

The Robertsons founded IFE in 1989 to buy The Family Channel from CBN.

The company first sold stock to the public in 1992, when it offered 10 million shares at $15 each.

The Robertsons maintained that there was a role in the glitzy entertainment industry for a network emphasizing traditional values with shows the whole family could watch.

By 1997, The Family Channel had become one of the country's largest basic cable TV networks, its signal reaching more than 69 million homes. It was generating more than $100 million in annual cash flow.

The network was also coveted by giants such as News Corp. and reportedly Disney, Viacom and others.

``The Robertsons have built a tremendous business with IFE, and we look forward to working with them to strengthen and expand it,'' Haim Saban, CEO of Fox Kids, said at the time of the buyout.

After today, IFE becomes the ``surviving corporation'' on corporate documents. Its shares will not be listed, and the big decisions likely will be made in Los Angeles. ILLUSTRATION: Chart

IFE Executives' Agreements as of June 1

For complete information see microfilm

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