WHATEVER EDGAR WANTS

By RICHARD CORLISS

How does the old song go? "Come closer now/ So I can see you in the dark/ . Hold on to me/ . And tell the things that no one else would say/ . And I love to hear your voice sayin' it's all right."

That 1985 Dionne Warwick ballad, Whisper in the Dark, summons up the erotic appeal of the unknown. And now the man who wrote its lyrics, Edgar Bronfman Jr., is coming closer to possessing something he has desired for most of his 39 years: a Hollywood studio. Last week Bronfman, the president and chief executive officer of Seagram Co., was deep in negotiations with Japan's Matsushita Electric Industrial to take control of MCA, which owns record labels, theme parks, TV shows, a pleasant parcel of Southern California real estate-and Universal Studios. Seagram, the Canadian purveyor of whiskey, wine and Tropicana juices, was reportedly offering about $5.6 billion for 80% of the entertainment conglomerate.

At week's end, many guesses and questions shrouded the negotiations. The two companies were insisting that "there is no assurance an agreement will be reached." But if the deal does fly, Matsushita will have escaped from a nettlesome marriage, though at a steep price (about a 35% loss on the original investment, owing mostly to the weakness of the dollar vs. the yen). And Bronfman, the wandering son who officially took over the family business only last year, will invest his shareholders' money so he can realize his dream. He will ascend from mere billionaire status to a more glamorous title: moviemaker.

Already Bronfman has earned the title of mischiefmaker. His sorties are tilting the fortunes of several prominent companies-not just Matsushita, MCA and his own but also Du Pont, Time Warner and infant multimedia outfit DreamWorks SKG. Last week, for $8.8 billion, the chemical giant bought back most of Seagram's 24.1% of Du Pont stock. Time Warner, of which Seagram owns a provocative 14.9%, braced for a messy stock scramble should Bronfman sell his shares. DreamWorks also looked to the shy, dapper mogul for indications that he would retain MCA's current, embattled management and thus be in line to distribute the new company's movies and CDs.

Entertainment executives saw MCA as a smart buy for the 21st century: surely there are rosier prospects for software than for spirits. But Bronfman wasn't selling his whiskey interests; he was giving up on a company with a strong present (Du Pont stock accounted for nearly 70% of Seagram's pretax profits last year) and a robust future. Unsurprisingly, Wall Street greeted both the Du Pont sale and the MCA negotiations with derision. On Friday Moody's Investors Service announced that it was considering "the possible downgrade" of Seagram's debt. Seagram stock dropped nearly 17% during the week, closing Friday at 26 1/2. Wall Street speculators signaled that they liked only one scenario: that an investor buying Bronfman's block of shares could set off a contest for Time Warner. Rumors that General Electric's Jack Welch could be the buyer helped send Time Warner's stock up more than 3% on Friday, closing at 38 1/4.

Close watchers of Seagram thought Bronfman got too little for his Du Pont stake. Says Ken Shea, an analyst at Standard & Poor's: "It doesn't make sense to dump a solid business like Du Pont, which throws off good dividends, and take on a much riskier investment in MCA. But then the press accounts of Edgar Jr. don't give him a lot of credit. They paint him as a Dan Quayle who is ready to wreck Seagram."

Bronfman could be Dan Quayle or Champale -- or something more potent, a strong successor to his father. Junior has cut costs, promoted such high-margin products as Martell Cognac and bought the Dole fruit-juice line to complement Tropicana. Seagram's profits doubled in 1994, to $734 million.

Edgar Sr. had his own expensive fling in movies; he bought part of MGM in 1967 only to sell it two years later at a loss of about $10 million. By that time, his son was reading scripts for producer David Puttnam. Edgar Jr. found a script he loved, and in 1972, at Puttnam's goading, produced the movie, a flop called The Blockhouse. He was 17. With a show-biz dilettante's drive, he invested in Broadway plays, wrote pop songs, married a singer-actress and produced a few other films-notably a Jack Nicholson melodrama, The Border, released in 1982 by MCA-Universal.

MCA has lately been involved in its own corporate melodrama. In 1990 Matsushita bought the company in a $6.6 billion deal arranged by the movie Mephisto, Michael Ovitz, chief of Creative Artists Agency. Profits were plentiful, thanks to a flourishing music division, helped by acquiring David Geffen's record holdings, and a folio of hit films, most of them produced by Steven Spielberg. And at first, Japanese-American relations were smooth. Then some of the Matsushita executives who were on good terms with MCA president Sidney J. Sheinberg were fired. Says MCA movie chief Tom Pollock: "I believe if the Matsushita administration hadn't changed, they would not have sold the company."

Sheinberg, a brassy American entrepreneur, wanted to diversify his business, but the conservative Japanese refused. Like Godzilla in hibernation, Matsushita sat in its Osaka cave, occasionally emerging to roar No! "Sid would have bought Virgin Records, he would have bought nbc," says Irving Azoff, MCA's former music boss. "He was really frustrated that the Japanese wouldn't let him do any of that." The brokered marriage was soon looking as vulnerable as Lyle Lovett's to Julia Roberts. And Ovitz, the canny matchmaker, was apparently unwilling or unable to save it.

When Spielberg formed DreamWorks with Geffen and former Disney movie czar Jeffrey Katzenberg, he realized both his value to MCA (he had kept Universal profitable with such hits as E.T., Back to the Future and Jurassic Park) and his personal debt to Sheinberg, whom he calls a mentor. So DreamWorks said some of its products could be distributed by MCA-in a deal that could be worth $1 billion over the next decade-if Matsushita would keep Sheinberg and chairman Lew Wasserman aboard. The Japanese never responded to the offer.

A rash of rumors now suggests that Bronfman, if he buys MCA, would ask one of his friends, Ovitz or at-large media mogul Barry Diller, to run it. But either of them would surely insist on substantial equity, and last week both were denying any interest in the job. It is more logical that Bronfman would urge Sheinberg to stay on-not least because that would assure MCA of a Spielberg-DreamWorks connection-but that Edgar Jr. would run the show.

"I don't want to speculate on what I'd like to have happen," Sheinberg said Friday. "And one reason, I guess, is that I don't know." But clearly he wants to put Matsushita behind him. "It means I'll be able to freely go about buying whatever brand of television I want to. There's something to be said for free choice." (Some MCA-ers may not agree: last week there was a run on the company store, as employees scurried to buy Matsushita hardware at discount before it was shipped back to Osaka.)

Freedom is exhilarating, and the movie business is intoxicating. Another whiskey merchant, Joseph P. Kennedy, thought so in 1928 when he briefly took over Patha pictures. Back then, Jules Stein, MCA's founder, was booking singers into speakeasies; and Sam Bronfman, the new owner of Seagram, was bootlegging spirits across the Canadian border into Prohibition-era America. Wall Street is hoping that for Seagram's sake, Sam's grandson Edgar Jr. does not forget the first rule of a speakeasy: the bartender is supposed to stay sober.

Maybe that doesn't matter to Bronfman: he hears his own voice sayin' it's all right. In this respect, Edgar Jr. is like the hero of one of his own movies. There is a scene in The Border where Jack Nicholson is asked why he is trying to accomplish a feat most people think is crazy. His reply: "I guess I gotta feel good about something I do." --Reported by Bernard Baumohl/New York, Patrick E. Cole and Jeffrey Ressner/Los Angeles and Edward W. Desmond/Tokyo

With reporting by BERNARD BAUMOHL/NEW YORK, PATRICK E. COLE AND JEFFREY RESSNER/LOS ANGELES AND EDWARD W. DESMOND/TOKYO