Bennett: Four Ways to Boost Liberty - Multichannel

Bennett: Four Ways to Boost Liberty

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Liberty Media Corp. president and CEO Robert Bennett said the Denver-based
media and telecommunications giant's goal is to broaden its distribution
footprint, adding that it is currently investigating four initiatives to do so.

Those initiatives are nothing new to followers of Liberty: pairing up with
News Corp. concerning a possible joint acquisition of direct-broadcast satellite
giant DirecTV Inc.; expanding its European cable footprint through its ownership
in United Pan-European Communications N.V. (UPC); possibly acquiring the Vivendi
Universal Entertainment division of Vivendi Universal; and exercising its put
option in February for its stake in home shopping channel QVC Inc.

Bennett offered little insight into any progress being made on any of those
fronts at the Salomon Smith Barney Inc. Entertainment, Media and
Telecommunications Conference in Palm Springs, Calif., Tuesday.

He did say that Liberty has been in conversations with News Corp. and DirecTV
parent General Motors Corp. about a possible acquisition of DirecTV. However, he
added, it was too early in the process to say what ultimately might happen.

'We are in conversations with News Corp. to create a partnership,' Bennett
said at the conference. 'Given our historic relationship with them, I'm
optimistic that we will be able to work that out.'

On the Vivendi front, Bennett confirmed speculation that Liberty would be
interested in buying the VUE unit, which consists of cable channels USA Network
and Sci Fi Channel, as well as Universal Studios and Universal Music.

'We don't know what [Vivendi] management will elect to do,' Bennett said. 'We
have discussed an interest in acquiring either all or a large stake in that
business. The combination of the studio and the networks is a natural fit with
[Liberty's premium-network programmer] Starz [Encore Group LLC].'

Last year, several published reports claimed that Liberty was trying to engineer a
deal where it would spin off Starz Encore and combine it with VUE. Vivendi has
been selling off assets to pay down its heavy debt.

But the French conglomerate has not announced its intentions for the VUE
unit.

Regarding
QVC, Liberty has a put option that takes effect in February where the
company could either buy out Comcast Corp.'s interest in the network or force Comcast
to buy its 42 percent interest.

Bennett said no decision on what to do has been made yet.

While Liberty had tried to expand its European cable footprint by attempting
to make big acquisitions in the Netherlands and Germany only to have them
squashed by regulators, Bennett said UPC's subscriber base -- it is the largest
cable operator in Europe, with 7.2 million subscribers -- is sufficient for the
time being.

'[UPC] gives us a business
that on its own is big enough to create value outside of the cable
business,' he said.

He added that once UPC has completed its debt restructuring -- expected in
March or April -- Liberty will still be its largest shareholder.

'We continue to be bullish on European cable,' Bennett said.

Regarding the four potential acquisition initiatives, Bennett said the common
thread is that either would fulfill Liberty's desire to have one or two
additional large operating companies in its portfolio.

'The point being to be able to use these businesses
either to create more liquidity for ourselves or to work with our other business
to add scale and to create another pocket of growth so that we're not just
relying on the individual businesses we have,' he added.

'That would be the agenda in DirecTV, the agenda in QVC, that's the agenda in
UPC and the agenda in Vivendi.'

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