Liberty Interactive pays distribution to holders of 1% exchangeables

By Marisa Wong

Morgantown, W.Va., June 30 – Liberty Interactive Corp. subsidiary Liberty Interactive LLC said it made an additional distribution to holders of its 1% senior exchangeable debentures due 2043.

Holders as of June 15 received an additional distribution of $2.2879 per debenture, according to a press release.

The additional distribution is attributable to the portion of a quarterly dividend paid by HSN, Inc. on June 21 in excess of $0.18 per share. Payments of additional distributions attributable to excess regular cash dividends do not result in a reduction to the principal amount of the debentures, the company noted.

Holders also received on Friday a quarterly interest payment of $2.50 per $1,000 original principal amount of debentures.

Principal adjustment

On June 30, the principal amount of the debentures was adjusted to $862.3616 per debenture from $862.7048.

Under the indenture for the debentures, the original principal amount of the debentures is reduced in an amount equal to each extraordinary distribution made to holders of the debentures. After that, the adjusted principal amount is further reduced on each successive quarterly interest payment date to the extent necessary so that the quarterly interest payment represents the payment of an annualized yield of 1% of the adjusted principal amount.

This latter adjustment, to the extent it is made through a particular extraordinary distribution that results in a reduction to the principal amount of the debentures, takes effect on the second succeeding interest payment date after the payment of that extraordinary distribution.

To date, Liberty has made one extraordinary distribution to holders of the debentures. On March 19, 2015, Liberty made an extraordinary distribution of $134.58 per $1,000 original principal amount, due to payment by HSN of a special cash dividend of $10.00 per share to HSN shareholders of record as of Feb. 9, 2015.

Reductions to the principal amount of the debentures do not affect the amount of the quarterly interest payments, which will continue to be at a rate of 1% per year.

As of June 30, 900 debentures remained outstanding in the aggregate adjusted principal amount of $776,125, including Friday’s quarterly interest payment, according to the release.

Englewood, Colo.-based Liberty Interactive owns interests in electronic retailing, media, communications and entertainment businesses.

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