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CED September 2010

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Investors object to Malone’s DirecTV deal
By Brian Santo
CedMagazine.com - May 15, 2009
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Liberty Media’s plan to combine DirecTV with several U.S. entertainment businesses into a separate company has hit a roadblock. Two public pension funds that have invested in DirecTV are suing the broadcaster to prevent the merger.

Liberty Media, which is run by John Malone, gained control of DirecTV last year.

Liberty Media’s plan is to create a separate operation that merges DirecTV with Fun Technologies, the Game Show Network (GSN) and Liberty Sports Holdings, which controls three regional sports networks . The combination would be called DirecTV.

The three operations are currently part of Liberty Media’s Liberty Entertainment unit, which also has investments in Starz Entertainment and WildBlue Communications. The financial arrangement is to have DirecTV buy the three units with stock.

Malone would retain a 24 percent interest in the separate unit.

The investors’ claim, according to The Associated Press, is that DirecTV is overpaying for the assets in Liberty Entertainment. The deal is structured with a $450 million breakup fee, plus up to another $10 million in expenses, which the suit calls unreasonable and an unfair deterrence to other potential bidders.

More Broadband Direct 05/15/09:
•  Comcast's 3.0 service now available in Pittsburgh area
•  Cablevision ponders offering travel services to customers
•  Investors object to Malone's DirecTV deal
•  Exfo tests 40/100 Gbps Ethernet
•  Agilent posts Q2 loss as revenue falls 25%
•  AT&T touts more smartphone users
•  Panasonic slumps to $4B yearly loss
•  Blockbuster profit, revenue sag; stock dives
•  Q1 CMTS, DSL shipments both down
•  Broadband Briefs for 05/15/09

 


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