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Liberty Media to spin off majority of Liberty Entertainment
New York, Dec. 12 - Liberty Media Corp. said it plans to distribute to holders of Liberty Entertainment group tracking stock shares of a subsidiary that will hold a majority of the businesses, assets and liabilities currently attributed to the Liberty Entertainment group.
The subsidiary, which will become a separate public company, will be called Liberty Entertainment, Inc. The businesses, assets and liabilities not included in Liberty Entertainment will continue to be attributed to the Liberty Entertainment group tracking stock.
The change has been approved by Liberty Media's directors and is intended to be tax free to stockholders.
"We believe a new asset-backed security will reduce the discount from fair value in our stock, thereby making it a more attractive currency, and will permit us to better pursue our strategic objectives," said Greg Maffei, president and chief executive officer of Liberty Media, in a news release.
As proposed, Liberty Entertainment will be comprised of 52% of DirectTV Group, Inc., 50% of GSN, LLC, 100% of FUN Technologies and 100% of Liberty Sports Holdings, LLC, which holds three regional sports networks.
Liberty Entertainment will have approximately $2 billion in debt incurred to acquire 78.3 million of DirecTV shares in April 2008.
The Liberty Entertainment tracking stock will primarily consist of 100% of Starz Entertainment, 37% of WildBlue Communications, Inc., and an undetermined amount of cash.
The split-off is subject to conditions including shareholder approvals.
Liberty Media is an Englewood, Colo., owner of interests in electronic retailing, media, communications and entertainment businesses.
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