[Satellite Today 05-05-09] DirecTV will merge with its majority shareholder, Liberty Entertainment, in an effort to consolidate Liberty’s broadcasting and programming units, the companies announced May 4.
The new unit will take on $2 billion of Liberty’s debt and $30 million in cash. DirecTV also will make $650 million in Liberty loan payments. No changes will be made to the senior management of either company and Liberty Media Chairman John Malone will control 24 percent of DirecTV after the merge is completed.
“This transaction clarifies DirecTV’s capital structure, reduces its shares outstanding, eliminates stock overhang and arbitrage issues, and provides DirecTV with strategic content businesses," Liberty CEO Greg Maffei said in a statement.
In February, Liberty Media granted Sirius XM radio a $530 million loan, giving Malone a 40 percent stake in the satellite radio provider.
DirecTV Merges With Liberty Entertainment
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