Liberty Media announced plans to spin off some of its assets in a new company called Liberty Broadband. Shareholders will receive shares in the new company pro rata for their holdings in Liberty Media. The new company will include Liberty Media's 26.4 percent stake in cable operator Charter Communications, its subsidiary TruePosition and a small stake in Time Warner Cable. Liberty said the spin-off makes sense given Charter's pending agreement to acquire part of the TWC and Comcast assets after their merger.
In the spin-off, holders of Liberty Media Series A, B and C common stock will receive one-fourth of a share of the corresponding series of Liberty Broadband common stock for each share held by them in Liberty Media. In addition, stockholders will receive a subscription right to acquire one share of Series C Liberty Broadband stock for every five shares of Liberty Broadband they receive in the spin-off. This will raise additional capital for the new company. The completion of the spin-off and the rights offering should be completed in the second half of the year.
