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Expedia to be spun off from IAC

March 30, 2005 |

IAC/InterActiveCorp, billionaire Barry Diller's Internet company, will give $250 million to its Expedia unit to provide it with capital when it is spun off as a public company.

IAC/InterActiveCorp, billionaire Barry Diller’s Internet company, will give $250 million to its Expedia unit to provide it with capital when it is spun off as a public company. IAC is considering a reverse stock split as part of the spinoff.

Expedia, which will consist of travel businesses Hotels.com, Hotwire, Expedia.com and other Web sites, probably will have a revolving credit line of $500 million at the time of the spinoff, New York-based IAC reported in a filing Monday with the U.S. Securities and Exchange Commission.

Diller on Dec. 21 said he would split IAC into two companies by giving shareholders Expedia stock and leaving Ticketmaster, Home Shopping Network and other companies under IAC. The company has said Expedia will have adequate funding while IAC will retain most of its cash. At the end of 2004, IAC had about $3.6 billion of cash and marketable securities.

“This seems to be reasonable,’’ said Janco Partners analyst Martin Pyykkonen, who rates IAC shares” accumulate’’ and doesn’t own them. “Expedia doesn’t need as much cash because it is cash-flow positive.’‘

Get the full story at Mercury News

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