Monday, December 6, 2010

Liberty (Nasdaq:LINTA), IAC (Nasdaq:IACI) Divorce Good for Both Says Barclays (NYSE:BCS

After the announced divestiture of Class B shares by Liberty (Nasdaq:LINTA) in IAC (Nasdaq:IACI), Barclays (NYSE:BCS) said they see it as a benefit for both companies.

Barclays said, "IAC and Liberty Media announced this morning that Liberty has exchanged its remaining 12.8 million Class B shares of IAC for $220 million in cash and IAC's operating businesses Evite and Gifts.com in a tax-free transaction. We view the deal as a positive resolution for both companies as it effectively amounts to a large share repurchase for IAC and is another step toward simplifying Liberty ahead of its split. We believe this could also set the stage for a similar transaction between Liberty and Expedia, though that would likely be much more complicated given the higher value of Liberty's stake in Expedia (~$1.9 billion) and the challenges in determining which assets could make a similar deal tax-free."

Liberty closed Friday at $15.95, up by $0.04, or 0.25 percent. IAC closed at $30.23, gaining $0.88, or 3.00 percent.

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