Liberty Interactive To Acquire GCI; Announces Plans For Creation Of GCI Liberty

(RTTNews) - Liberty Interactive Corp. (QVCA, QVCB, LVNTA, LVNTB) and General Communication, Inc. (GNCMA) announced a definitive agreement whereby Liberty Interactive will acquire GCI through a reorganization in which certain Liberty Ventures Group assets and liabilities will be contributed to GCI in exchange for a controlling interest in GCI. Shareholders of GCI will receive total consideration of $32.50 per share comprised of $27.50 per share in GCI Liberty Class A common stock and $5.00 in newly issued Series A preferred shares. The transaction represents an undiluted enterprise value for GCI of $2.68 billion and undiluted equity value of $1.12 billion.

Liberty Interactive will then effect a tax-free separation of its controlling interest in the combined company (to be named GCI Liberty Inc.) to the holders of Liberty Ventures common stock in full redemption of all outstanding shares of such stock. The split-off of Liberty Interactive's interest in GCI Liberty is expected to be completed by the first quarter of 2018. GCI Liberty's Class A common stock, Class B common stock and Series A preferred stock are expected to be listed on The Nasdaq Stock Market under the symbols, GLIBA, GLIBB and GLIBP, respectively.

Liberty Interactive is expected to be renamed QVC Group, Inc. and establish a pure play discovery based retail and eCommerce company. Liberty Interactive believes an asset-backed QVC Group will be eligible for possible inclusion in stock indices through elimination of tracking stock structure.

Upon completion of the transaction, former GCI shareholders will own 23% of the undiluted equity and 16% of the undiluted voting power of GCI Liberty, and former Liberty Ventures shareholders will own the remaining equity and voting interests in GCI Liberty. Greg Maffei, Liberty Interactive CEO, stated: "This transaction will ultimately create a standalone Liberty Ventures, reducing the tracking stock discount and enabling an asset-backed QVC Group."

GCI is the largest communications provider in Alaska, providing data, wireless, video, voice, and managed services to consumer and business customers throughout Alaska and in the lower 48 states.