Liberty Announces $1.75B AOL Issue
By Mike Farrell -- Multichannel News, 3/24/2003 3:00:00 AM
Liberty Media Corp. said it will issue up to $1.75 billion in bonds convertible into AOL Time Warner Inc. stock -- a move that could raise money for future acquisitions.
Liberty currently owns about 171 million shares of AOL Time Warner, worth about $2 billion.
While Liberty said the proceeds of the offering would go toward general corporate purposes, most observers believe the cash could be used for deals to acquire DirecTV Inc., QVC Inc., or Vivendi Universal Entertainment.
The offering is expected to close March 26.
In a separate announcement, Liberty said its ongoing legal battle with Comcast Corp. regarding the latter's dispute with Starz Encore Group LLC would likely cost the premium-movie-channel programmer about $80 million in revenue this year, according to a Securities and Exchange Commission filing Thursday.
Comcast is seeking to reduce the fixed monthly fees it pays to carry Starz's programming on former AT&T Broadband systems, arguing that prices should be based on Comcast's agreement with Starz, which calls for fees based on the number of subscribers to the channel.
Comcast acquired AT&T Broadband in November.
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