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John Malone’s Liberty Interactive snaps up General Communications for US$1.12bn
Liberty Interactive Group (NASDAQ:QVCA) – owned by billionaire John Malone – has snapped up Alaska’s biggest cable operator General Communications Inc (NASDAQ:GNCMA) in an all-stock deal worth US$1.12bn.
Shares in General Communications jumped more than 60% on Tuesday following the announcement.
GCI serves cable TV and broadband to more than 108,000 across Alaska and it is also the state’s largest telephone and wireless provider.
Telecom entrepreneur Malone is renowned for negotiating complex deals in order to benefit his company, and this one is no different.
Once the takeover is completed, Liberty Interactive will be renamed QVC Corp to offer an asset-backed stock built around the home shopping service.
GCI will be held by the Liberty Ventures Group side of the business, which is also home to Liberty Broadband and Charter Communications as well as other companies.
Liberty Ventures will then be split off from the combined company into a new one called GCI Liberty.
The newly-formed QVC Corp (currently known as Liberty Interactive) will control 77% of GCI Liberty as well as an 84% voting interest.
“GCI is the largest communications provider in Alaska, generates solid cash flow with upside potential and is a strong fit with the largest businesses in Liberty Ventures,” said Liberty Interactive president and chief executive Greg Maffei.
“This transaction will ultimately create a standalone Liberty Ventures, reducing the tracking stock discount and enabling an asset-backed QVC Group.”
The deal will see GCI go full circle having once been part of Liberty’s former parent company, Tele-Communication Inc.
“We couldn’t think of a better owner, and look forward to being the largest operating asset within GCI Liberty,” said CGI president and chief executive Ron Duncan.
“We will continue to run the company with our focus on providing the best value for Alaska customers, offering opportunities for our employees and investing wisely in the Alaska market.”
Liberty Interactive shares closed at US$20.42 on Tuesday, while GCI shares finished the day at US$33.39.
Story by ProactiveInvestors
Source: http://www.proactiveinvestors.com/companies/news/176023/john-malones-liberty-interactive-snaps-up-general-communications-for-us112bn-176023.html
