Turner Plan to Buy MGM/UA May Have Hit Snag, Sources Say

Complications apparently have developed in Turner Broadcasting System’s planned $1.45-billion friendly acquisition of MGM/UA Entertainment, sources close to the parties said late Friday.

The Atlanta-based broadcaster, 80% controlled by entrepreneur Ted Turner, failed to file its final registration update with the Securities and Exchange Commission by Friday, which a source close to its investment banker had told The Times earlier this week would be done.

According to sources, Turner’s New York investment banker, Drexel Burnham Lambert, which has been planning to raise the money for Turner, had raised eleventh-hour questions about MGM’s financial situation.

This precipitated further discussions, according to the sources. One source said it appeared that Turner himself did not want to abort the deal, although some of his advisers might favor such a course.

Officials of Drexel Burnham and Culver City-based MGM, as well as lawyers here for Turner, were said to be in meetings Friday and did not return calls from The Times.

MGM’s stock dropped $1.75, closing at $21 on Friday in New York Stock Exchange composite trading. A total of 539,200 shares changed hands in a second day of heavier-than-usual trading. On Thursday, MGM’s stock rose $1.875.