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| Type | Holding Company |
|---|---|
| Founded | Spin-off from TCI (1991) |
| Headquarters | Meridian, Colorado[1] |
| Key people | John C. Malone, Chairman; Gregory B. Maffei, President and CEO |
| Industry | Broadcasting & Cable TV |
| Products | Holding Company focused on media |
| Divisions | Liberty Capital, Liberty Media, Liberty Interactive |
| Website | www.libertymedia.com |
The Liberty Media Corporation is an American media conglomerate and the control is exercised by company Chairman John C. Malone, with a majority of the voting shares. Liberty Media operates three divisions: Liberty Capital (NASDAQ: LCAPA, NASDAQ: LCAPB), Liberty Entertainment (NASDAQ: LMDIA, NASDAQ: LMDIB), and Liberty Interactive Group (NASDAQ: LINTA, NASDAQ: LINTB). The tracking stock of each division of Liberty Media trade on the NASDAQ stock exchange.
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History
The 1990s
Liberty Media Corp. began in 1991 as a spin-off of TCI, an American cable television group. Peter Barton, hired by TCI's John C. Malone, served as president until retiring in April 1997 to start an investment firm and spend time with his family[2].
Liberty Media took over TCI assets considered to have little value, but Barton completed "a deal every ten days for six years" and made the company a big success. Liberty was merged back into TCI in the mid-1990s[3].
On March 13, 1998, Liberty Media Group and TCI Group announced the merger of Encore and STARZ! into a single company--Encore Media Group, owned by Liberty. Encore was taking advantage of the growth of digital cable, while TCI, which had previously owned 20 percent of Encore, was more interested in traditional cable[4].
After United States Department of Justice approval that required TCI to sell its 23.5 percent interest in Sprint Corporation PSC[5], TCI merged with AT&T on March 9, 1999[6] for approximately $48 billion. Liberty Media merged with TCI Ventures Group LLC (TCIVA), TCI's telephone and Internet businesses, and the resulting company became part of AT&T, giving Liberty Media $5.5 billion for use to repurchase stock or buy other companies. Liberty Media also could borrow $6 billion without lowering AT&T's debt rating.
AT&T bought the other TCI businesses--@Home Corp., National Digital Television Center and Western Tele-Communications Inc.--for $2.5 billion in cash. TCI chairman Malone, who became head of the new company, said buyers would not want all of TCI, but they would be interested in Liberty Media[7]. Malone wanted to start a finance unit similar to GE Capital, which could start new cable or Internet services. TCI had already planned digital cable set-top boxes[8].
On September 28, 1998, Liberty Media announced the formation of Liberty Interactive, a company which would take advantage of new technologies such as set-top boxes to develop interactive programming. The company would own 86 percent of TCI Music Inc. (NASDAQ symbol: TUNE/TUNEP). As of January 1, 1999, E! Entertainment President and CEO Lee Masters would become the new company's CEO, and Bruce Ravenel would be Chief Technology Officer[9].
On September 10, 1999, Liberty Media Group renamed TCI Music to Liberty Digital Inc. (NASDAQ symbol: LDIG), with the new company trading on NASDAQ's National Market tier, after Liberty Media traded most of its Internet content, interactive television assets, and rights to provide AT&T's cable systems with interactive services, plus cash and notes valued at $150 million, for TCI Music stock[10]. Masters, who became Liberty Digital's CEO, told The Wall Street Journal that the new company had a value of $1 billion, $650 million of that from the interactive unit of Liberty Media, which had also used the name Liberty Digital[11]. Liberty Digital lost $244 million with revenue of $66 million in 1999, thanks to investments in struggling Internet businesses homegrocer.com, drugstore.com, TiVo and iVillage. The company bought half of Game Show Network because of its interactive features[12].
On December 17, 1999, TCI Satellite Entertainment Inc. (TSAT), based in Englewood, Colorado, announced that Liberty Media was trading its interest in Sprint PCS for $300 million in TCI Satellite preferred stock. A new company, 90 percent owned by Liberty Media and 10 percent owned by TCI Satellite, would combine the satellite-related businesses and take advantage of the growing area of Internet content. Liberty Media president and CEO Robert R. Bennett said the deal would benefit stockholders of both companies[13].
Another new company was Liberty Livewire, formed from Todd-AO and two other companies by Liberty Media, which provided audio and video post-production services. David Beddow of TCI became CEO[14].
The 2000s
Liberty Media's Discovery Channel, News Corporation and QVC continued to do well, but the company's newer projects had problems, and the company's stock price dropped by half. Malone no longer had the "Malone halo" he once did. Among the companies that were not doing well after the end of the technology boom: ICG, Priceline.com, Cendant, Emmis Communications, and Teligent. If AT&T agreed to spin off Liberty Media, new deals such as a possible News Corp. purchase of DirecTV would be easier because AT&T would no longer require federal approval to complete such deals[15].
Liberty Media was spun-off from AT&T on August 10, 2001[16]. This was one of three possible actions to ensure federal approval of AT&T's $54 billion acquisition of MediaOne Group--the others were selling its 25.5% share of Time Warner Entertainment and dropping 11.8 million cable customers[17].
Also in 2001, Liberty Media acquired the remainder of Liberty Digital and Liberty Satellite & Technology (formerly TCI Satellite). Both companies were independent spinoffs of TCI, though Liberty already owned 90 percent of both companies after the exchange for Sprint PCS stock. Being independent increased their asset values, but the stock prices of both dropped, negating any benefits[18][19].
Liberty Media subsequently spent $5 billion on nine German regional cable networks. Apart from television distribution it holds major interests in other groups. For example it was the largest shareholder in News Corporation (though the founding Murdoch family owns more voting shares), and had a 4% stake in Time Warner. As of December 2003 it had never paid a dividend[citation needed].
In May 2006, Time Warner acquired Liberty Media's 50% stake in Court TV for $735 million[20].
On May 16, 2006, IDT sold its IDT Entertainment division to Liberty Media "for all of Liberty Media's interests in IDT, $186 million in cash and the assumption of existing indebtedness." IDT Entertainment's assets and Starz Entertainment Group's popular line of premium TV channels will combine to produce content for all distribution platforms [21].
Liberty negotiated an asset swap with News Corp. and Time Warner that would give it control of DirecTV and the Atlanta Braves baseball team[22]. On February 12, 2007, the deal was completed with Time Warner wherein Liberty would receive the Atlanta Braves, a group of craft magazines and $1 billion in cash in exchange for 60 million shares of Time Warner stock (valued at $1.27 billion as of market close on February 12, 2007)[23]. The deal was approved by Major League Baseball and then completed on May 16, 2007[24]. On February 20, 2008, the Federal Communications Commission approved the exchange of 16.3 percent of News Corp. for 38.4 percent of DirecTV, an $11 billion deal that also gave Liberty sports networks in Denver, Pittsburgh and Seattle plus $550 million in cash[25].
Liberty has also purchased Green Bay, Wisconsin, television station WFRV-TV and its sister station in Escanaba, Michigan, WJMN-TV, from CBS estimated at about $234 million. CBS will swap the stations and $170 million in cash for 7.59 million shares of CBS common stock held by Liberty Media. The purchase was announced February 13, 2007. The sale was completed on April 18, 2007[26].
On February 17, 2009, Liberty announced that it would invest up to $530 million into the struggling Sirius XM Radio Inc., in a structured deal that would help the satellite radio provider avoid filing bankruptcy protection by meeting its obligations. The deal also provided for two board seats for Liberty Media, and provided cash for operations and development, with a maturity date of December 2012 for the loan.[27] On March 6, the two companies approved the second part of the deal, with Sirius XM getting $250 million immediately and Liberty receiving 12.5 million shares of preferred stock convertible into 40 percent ownership of Sirius XM common stock[28].
Governance
Members of the board of Liberty Media are: Robert R. Bennett, Donne Fisher, Paul Gould, Greg Maffei, John Malone, David Rapley, LaVoy Robison, and Larry Romrell.
Divisions
Liberty Capital
Attributed to Liberty Capital are:
- Marginal shareholdings in companies including Time Warner and Viacom
- TruePosition
- Atlanta Braves
- Starz Media
- Overture Films
- WFRV-TV 5 and WJMN-TV 3: CBS affiliates for Green Bay, Wisconsin and Escanaba, Michigan (under WFRV and WJMN Television Station, Inc.)
- MacNeil/Lehrer Productions (67%)
Former assets
- Court TV (now truTV) (50% stake with Time Warner). On May 12, 2006, Time Warner bought the other 50% of Court TV for $735 million[29].
Liberty Entertainment
Attributed to Liberty Entertainment are:
- Liberty's 48% interest in The DirecTV Group
- Starz Entertainment (including Starz! and Encore)
- Liberty's 50% interest in GSN
- FUN Technologies, including Fanball
- Liberty Sports Holdings: Owners of FSN Pittsburgh, FSN Rocky Mountain, and FSN Northwest
- Overture Films
On September 3, 2008 Liberty Media decided to initiate the process of spinning off Liberty Entertainment to Liberty Media shareholders (leaving Malone with a majority ownership of the new company)[30].
On May 4, 2009, DirecTV Group Inc. said it would become a part of Liberty's entertainment unit, part of which would then be spun off as a separate company called DirecTV. The rest of the unit would be traded as Liberty Starz. Liberty would increase its share of DirecTV from 48 to 54 percent, with Malone and his family owning 24 percent.
The resulting company would own Game Show Networks, FUN Technologies and the three regional sports networks that had been part of Liberty.[31]
Liberty Interactive Group
Attributed to Liberty Interactive Group are:
- QVC, Inc.
- Provide Commerce (operator of proflowers.com)
- Bodybuilding.com
- BuySeasons (operator of buycostumes.com)
- Lockerz
and Liberty's interests in:
References
- ^ The postal designation of Englewood, Colorado appears in the corporation's mailing address.
- ^ http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/09-09-2002/0001796277&EDATE=, Retrieved on 2009/02/24.
- ^ http://www.alexanderstreet6.com/firp/firp.detail.documents.aspx?documentcode=OHI0022679-24069, Retrieved on 2009/02/24.
- ^ http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/04-16-1999/0000910828&EDATE=, Retrieved on 2009/02/24.
- ^ "TCI to Sell Sprint PCS Stake; U.S. OKs Merger With AT&T". Los Angeles Times: p. C-3. 1998-12-31. http://articles.latimes.com/1998/dec/31/business/fi-59210. Retrieved 24 February 2009.
- ^ http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/05-20-1999/0000944019&EDATE=, Retrieved on 2009/02/24.
- ^ "The New TCI: What's Left?". CNNMoney. 1998-06-24. http://money.cnn.com/1998/06/24/companies/liberty. Retrieved 6 May 2009.
- ^ "Liberty Media, TCI Ventures to Merge". Los Angeles Times: p. D-7. 1998-06-25. http://articles.latimes.com/1998/jun/25/business/fi-63411. Retrieved 24 February 2009.
- ^ http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/04-16-1999/0000910826&EDATE=, Retrieved on 2009-03-05.
- ^ http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/09-10-1999/0001019050&EDATE=, Retrieved on 2009-03-05.
- ^ http://www.internetnews.com/bus-news/article.php/93631/Liberty%20Media%20TCI%20Form%20Internet%20Group.htm, Retrieved on 2009/02/24.
- ^ Doan, Amy (2000-08-26). "Liberty Is Sweet On Interactive TV". Forbes. http://www.forbes.com/2000/08/26/feat.html. Retrieved 5 March 2009.
- ^ http://www.prnewswire.com/cgi-bin/stories.pl?ACCT=104&STORY=/www/story/12-21-1999/0001102058&EDATE=, Retrieved on 2009/02/24.
- ^ http://www.referenceforbusiness.com/history2/2/Liberty-Livewire-Corporation.html, Retrieved on 2009/02/24.
- ^ Colman, Price (2000-11-26). "No Triumph for Liberty: What Went Wrong and How Bennett and Malone Expect to Make It Right". Broadcasting & Cable: p. D-7. http://www.broadcastingcable.com/article/145735-No_Triumph_for_Liberty.php. Retrieved 24 February 2009.
- ^ Farrell, Mike (06-18-2001). "AT&T to Spin Off Liberty Aug. 10". Multichannel News. http://www.multichannel.com/article/55449-AT_T_to_Spin_Off_Liberty_Aug_10.php. Retrieved 6 May 2009.
- ^ "AT&T to spin off Liberty". Multichannel News. 2001-11-15. http://money.cnn.com/2000/11/15/deals/liberty. Retrieved 6 May 2009.
- ^ Llanor Alleyne, "Liberty Absorbing Digital, Satellite Units," Broadcasting & Cable, October 16, 2001.
- ^ "Gates Stake Lifts Liberty Satellite". Multichannel News. 2001-04-22. http://www.multichannel.com/article/126427-Gates_Stake_Lifts_Liberty_Satellite. Retrieved 6 May 2009.
- ^ "Time Warner Takes Control of Court TV". CNNMoney.com. 05-12-2006. http://money.cnn.com/2006/05/12/news/companies/courttv/index.htm. Retrieved 6 May 2009.
- ^ http://www.idt.net/about/press/story.aspx?id=15601, Retrieved on 2009/01/02.
- ^ David Lieberman, "Liberty Media Deals for DirecTV," USA Today, December 26, 2006.
- ^ Ronald Blum, "Time Warner Reaches Deal to Sell Braves," The Washington Post, February 13, 2007.
- ^ http://www.timewarner.com/corp/print/0,20858,1622200,00.html, Retrieved on 2009-05-06.
- ^ Hearn, Ted (2008-02-25). "Liberty Media Completes DirecTV Buyout". Multichannel News. http://www.multichannel.com/article/132230-FCC_Approves_Liberty_Takeover_of_DirecTV.php. Retrieved 6 May 2009.
- ^ http://www.cbscorporation.com/news/prdetails.php?id=2043, Retrieved on 2009/01/02.
- ^ http://www.cnbc.com/id/29239722?__source=RSS*blog*&par=RSS
- ^ http://www.radioink.com/Article.asp?id=1202155&spid=24698#Scene_1
- ^ http://www.timewarner.com/corp/newsroom/pr/0,20812,1193700,00.html, Retrieved on 2009/01/02.
- ^ http://phx.corporate-ir.net/phoenix.zhtml?c=61138&p=irol-newsArticle&ID=1193113&highlight=, Retrieved on 2009/01/02.
- ^ Yao, Deborah (4 May 2009). "DirecTV, Liberty Media Detail Spinoff Plans". Associated Press. http://www.newsobserver.com/business/story/1512847.html. Retrieved 4 May 2009.
External links
- Official web site
- Ketupa - Liberty Media Corporation in-depth profile
- Yahoo! - Liberty Media Corporation Company Profile
- Yahoo! Business News: Liberty Media to invest in Sirius XM Radio
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| Current Major League Baseball owners | ||
|---|---|---|
| American League | ||
| East Division
Angelos (Baltimore) |
Central Division
Reinsdorf (Chicago Sox) |
West Division
Moreno (L. A. Angels) |
| National League | ||
| East Division
Liberty Media (Atlanta) |
Central Division
Ricketts (Chicago Cubs) |
West Division
Kendrick (Arizona) |
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