Liberty Media sharpens F1 focus with spinoff as Malone set to take driver's seat
Liberty Media to spin off most non-motorsports assets
Long-time CEO Maffei to hand over reins to chair John Malone
Charter to buy Liberty Broadband
Adds analyst comment in paragraph 17; Updates shares
By Deborah Mary Sophia and Harshita Mary Varghese
Nov 13 (Reuters) -Formula One owner Liberty Media FWONA.O will sharpen its focus on its motorsports businesses by spinning off most of its other assets and said Chairman John Malone would become the interim CEO when its long-time top boss steps down at the end of 2024.
Greg Maffei, who spearheaded the company's rapid expansion across the media, communications, sports and entertainment sectors during his nearly two decades at the helm, will take on a senior adviser's role, effective Jan. 1.
Separately on Wednesday, Liberty Broadband, which was spun off from Liberty Media in 2014, said it had agreed to merge with Charter Communications CHTR.O in an all-stock deal.
Following the spin-off, Liberty Media will primarily hold its motorsports subsidiaries Formula One and MotoGP, and other related sports investments.
It would split off unit Liberty Live Group into a separate public entity, which will own about 70 million shares in U.S. concert promoter Live Nation Entertainment LYV.N, among other assets.
The new company, which will be called Liberty Live, will also own Liberty Media's ticketing and events unit Quint, along with private assets, cash and debt obligations attributed to the Liberty Live Group.
"The split-off of Liberty Live Group into a separate public entity will simplify Liberty Media's capital structure, should reduce the discount to net asset value of our Liberty Live stock and enhance trading liquidity at both entities," Liberty Media CEO Maffei said.
Liberty Media in 2016 struck a deal to buy Formula One from a consortium of sellers led by CVC Capital Partners for $4.4 billion. It bought Quint earlier this year.
Following the split, Liberty Media would no longer have a tracking stock structure. A tracking stock depends on the financial performance of the segment of the business it "tracks". They trade separately from the parent company's stock.
Liberty Media expects to complete the spin-off in the second half of 2025.
"Following today's announcements at Liberty Media and Liberty Broadband, all the Liberty acquisitions completed during my tenure are now in structures where shareholders can have more direct ownership in their upside," Maffei said.
Media mogul Malone, 83, set up the Liberty media empire and is known for his success in rolling up U.S. pay-TV businesses with complex financial structures.
TOP SHAREHOLDER
Liberty Broadband, which owns 26% of Charter on a fully diluted basis, had a market value of about $14 billion, according to LSEG data.
The Charter offer values Liberty Broadband at $13.22 billion based on terms of the transaction, according to Reuters calculations.
Liberty Broadband will spin off its GCI division to the company's shareholders prior to the closing of the Charter merger, expected to be in June 2027. GCI, an Alaskan cable operator, provides wireless, video and voice services.
"The only real question had been whether Charter would or wouldn't include GCI. Charter's investors seem to be pleased that GCI isn't included," said MoffettNathanson analyst Craig Moffett.
Liberty Broadband shares were down about 3%, while Charter rose more than 5%.
Under Maffei, Liberty Media made several acquisitions and investments including the DirecTV, SiriusXM, Live Nation Entertainment and Formula One.
Reporting by Deborah Sophia, Harshita Mary Varghese and Arsheeya Bajwa in Bengaluru; Editing by Shounak Dasgupta and Sriraj Kalluvila
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
