Liberty taps Maffei as CEO, posts loss | VailDaily.com
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Liberty taps Maffei as CEO, posts loss

DENVER – Liberty Media Corp. said Wednesday it is focusing on the future of its interactive business, hiring a former Oracle Corp. finance chief to head the company and creating a tracking stock for the home shopping network QVC and related assets. It also said it swung to a third-quarter loss due to higher expenses.Liberty’s chairman and chief executive John C. Malone said the tracking stock would encompass as much as 85 percent of Liberty’s equity assets and could lead to a spinoff.”This creation of Liberty Interactive clearly signals a desire long-term for ultimate separation,” Malone told analysts during a conference call.If a spinoff occurred, the remaining assets – including Liberty’s 18 percent stake in Rupert Murdoch’s News Corp. and cable network owner Starz Entertainment Group – would be grouped in a company called Liberty Capital.”We continue to explore various things with News Corp. We don’t have anything specifically that we want to discuss publicly at this point,” Malone said. “Our goal is basically to maximize the long-term value of our News Corp. holdings on an after-tax basis.”Analyst Matthew Harrigan of Janco Partners said the interactive assets would mesh well and noted that it was a good move given the tax implications stemming from Liberty’s purchase of a 57 percent stake in QVC from Comcast Corp. in September 2003.”This is a gradual path rather than a full-speed locomotive,” he said. “You can’t do a full spin right now without having to worry about the IRS a lot.”Stifel Nicolaus & Co. Inc. analyst Theodore Henderson of Denver noted that the market had a “ho hum” reaction to the news. “I think because people are more interested in watching John Malone and Rupert Murdoch figure out exactly what the final end game is going to be for Liberty and News Corp.,” he said.Gregory B. Maffei, who resigned as Oracle’s chief financial officer last week after four months on the job, is expected to take over as CEO of Liberty in the second quarter of 2006, replacing Malone. Malone will remain as chairman.Maffei, 45, said he would try to help Liberty leverage its operating assets with interactive businesses as well as develop tax efficiencies. “The attraction of Liberty was pretty easy, great assets in businesses,” he said.At the time of his resignation, Maffei said he was going to work for another company but declined to name it. He will remain with the business software manufacturer until Nov. 15, when company co-President Safra Catz will assume CFO duties.For the quarter that ended Sept. 30, the Englewood, Colo.-based Liberty reported a loss of $94 million, or 3 cents a share, compared with net income of $372 million, or 13 cents a share, in the third quarter of 2004.Revenue totaled $1.85 billion, up 13 percent from $1.63 billion in the previous quarter on the strength of QVC’s domestic and international sales. Starz, which operates a premium cable movie channel and Internet movie rental site, reported flat revenue.Analysts polled by Thomson Financial expected break-even per-share results on revenue of $1.86 billion.Liberty’s Class A shares rose 7 cents, or 0.88 percent, to $8.02 in heavy trading on the New York Stock Exchange.Liberty is a media holding company with interests in a diverse range of companies including cable channels QVC, Starz and Encore, IAC/InterActiveCorp, and News Corp.It previously spun off its international holdings into Liberty Global Inc. and created Discovery Holding Co., which owns Ascent Media Group and has a 50 percent stake in Discovery Communications Inc.—On the Net: http://www.libertymedia.comVail, Colorado


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