By Dow Jones Business News, October 10, 2013, 10:25:00 AM EDT
Liberty Interactive Corp. plans to reorganize its tracking stocks as part of a recapitalization effort, creating new
holdings called QVC Group and Liberty TripAdvisor Holdings.
Liberty Interactive operates and owns interests in a broad range of digital commerce businesses. The interests
currently are attributed to two tracking stocks: Liberty Interactive Group (LINTA, LINTB) and Liberty Ventures Group
(LVNTA, LVNTB). The Interactive Group is primarily focused on digital commerce, while the Ventures Group comprises
Liberty's holdings in TripAdvisor Inc. ( TRIP ), its interest in Expedia Inc. (EXPE) and other assets.
A tracking stock is issued by a parent company that follows the performance of a specific division generally without
having claim on the assets of that division.
The new QVC Group class of stock will be created out of the Liberty Interactive Group and track the value of QVC Inc.
and Liberty's roughly 38% interest in HSN Inc. ( HSNI ). The other assets and liabilities that are currently part of the
Liberty Interactive tracking stock, including Liberty's e-commerce companies, will be attributed to a new Liberty
Digital Commerce tracking stock.
Liberty said it was making the change to "provide greater clarity regarding QVC's strong operating metrics, such as
its leadership in mobile commerce."
The company said it sees QVC generating $1 billion in mobile revenue this year, adding that mobile now represents 30%
of all its e-commerce revenue.
Additionally, Liberty wants to expand the global reach of QVC, whose international business posted a 6% drop in
revenue for the second quarter while U.S. revenue rose 3%. The company on Thursday identified France, Turkey, Spain,
India and Brazil as possible targets for expansion.
Liberty wants QVC to enter a new international market every two to three years, Chief Executive Gregory B. Maffei said
in a presentation Thursday afternoon.
In the recapitalization, holders of Liberty Interactive Group tracking stock will receive a distribution of the new
Liberty Digital Commerce tracking stock, and the name of Liberty Interactive Group tracking stock will be changed to QVC
Group tracking stock.
Liberty Digital shares are expected to trade under "LDCA" and "LDCB," and QVC Group shares are expected to trade under
"QVCA" and "QVCB."
Separately, Liberty Interactive Corp.'s other tracking stock group, Liberty Ventures Group, plans to spin off is
ownership interest in TripAdvisor into a newly formed company called Liberty TripAdvisor Holdings, which will trade
under "LTRPA" and "LTRPB."
The new company would comprise Liberty's 22% economic and 57% voting interest in TripAdvisor, as well as Liberty's
BuySeasons business. In the spin-off, holders of Liberty Ventures stock would receive one share of the new TripAdvisor
Holdings stock for each Ventures share held.
Michael Calia contributed to this article
Write to Ben Fox Rubin at firstname.lastname@example.org
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