Liberty Media Nears Tracker Spins

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Liberty Media's planned spin-off of its Liberty Capital and Liberty Starz tracking stocks cleared another hurdle Monday after a Delaware Chancery Court ruled against some bondholders led by Bank of New York that were trying to block the deal.
Liberty first proposed spinning off Liberty Capital (which includes several passive investments in media companies and a controlling interest in the Atlanta Braves Major League Baseball team) and Liberty Starz, which includes the Starz LLC premium channels in 2010. While Liberty Capital and Liberty Starz will remain tracking stocks after the deal is complete, Liberty Interactive, which includes QVC Inc., Provide Commerce, Backcountry.com, Buyseasons, Bodybuilding.com, and interests in IAC/InterActiveCorp and Expedia, would become an asset-backed stock.
Liberty had set a May 23 shareholder vote for the spin.
According to documents filed with the Securities and Exchange Commission, the Delaware Chancery Court ruled that the that the "previously announced plan to split-off the businesses, assets and liabilities currently attributed to Liberty's Liberty Capital and Liberty Starz tracking stock groups will not constitute a disposition of all or substantially all the assets of Liberty Media, LLC under the indenture governing its public indebtedness."
Liberty said in the filing that the parties have been directed to prepare a form of final decree implementing the ruling, which Liberty plans to do shortly. The judgment is subject to appeal, which must be filed within 30 days from the entry of the final decree. If an appeal is filed, Liberty will request expedition of the appeal.
Liberty said in the filing that the spin is conditioned on a "final non-appealable judgment" on the matter.

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