QVC parent Liberty Interactive will spin off e-commerce services vendor CommerceHub and its stake in Expedia.

(Bloomberg)—Entities controlled by billionaire John Malone are creating three tracking stocks and spinning off two companies, the latest of numerous and complicated financial maneuvers that have enabled his empire to save taxes and develop targeted investments over the years.

Liberty Media Corp. will form tracking stocks for the Atlanta Braves baseball team and satellite-radio company Sirius XM Holdings Inc., letting investors bet on those assets, according to a statement Thursday. Separately, Liberty Interactive Corp. will split off two companies, one focused on e-commerce services vendor CommerceHub Inc. and the other on its stake in travel site Expedia Inc.

“It only gets more and more complex and confusing,” said Paul Sweeney, an analyst at Bloomberg Intelligence. “It seems the primary driver here is to create cleaner capital structures for each business that may allow for more efficient capital raising for acquisitions, dividends and distributions.”

Since Malone split off Liberty Media from Liberty Interactive in 2011, the companies have both gone through a series of moves that carved out the QVC home-shopping business, as well as holdings in Starz LLC premium cable network and TripAdvisor. The media magnate has also used tracking stocks to push for takeovers, such as the Liberty Broadband tracking stock created last year to fund further investments by Charter Communications Inc. Charter has since agreed to buy Time Warner Cable Inc. and Bright House Networks LLC for $55.1 billion and $10.4 billion, respectively.

Liberty Media’s gains stand close to 17% in the past 12 months. Liberty Interactive hasn’t performed so well during that period: its QVC stock has dropped 5.6% in a year. QVC is No. 15 in the Internet Retailer 2015 Top 500 Guide


The third Liberty Media tracking stock will keep interests in Live Nation Entertainment Inc. and minority equity investments in Time Warner Inc. and Viacom Inc. The company expects to complete the creation of the three new tracking stocks in the first half of 2016.

‘Pure’ trackers

Liberty Interactive, led by CEO Greg Maffei and itself structured as two tracking stocks—QVC and Liberty Ventures—will distribute the spinoffs tax-free to shareholders of Liberty Ventures.

Maffei said the goal with Liberty Media is to reduce its discount to its net asset value. 

“We’re going to isolate, hopefully, where the discount resides and that may provide a better repurchase opportunity for that entity,” Maffei said at an investor’s conference last week. There are “opportunities for each of the trackers, each of the currencies, to do something different and potentially either expand, combine, or raise capital based on their own needs, based on their own potential capitalization.” The Liberty Braves Group and Liberty Sirius Group “will be quite pure,” Maffei said.


Malone, a pioneer in the cable industry who made his fortune by engineering complex and lucrative financial arrangements, has an empire that stretches globally. His Liberty Global, which has spent more than $51 billion expanding in Europe over the past decade, has been buying content assets so it can hold the rights to TV programs and movies instead of just owning the cable pipes that distribute them. It’s also targeting Latin America, and in July created a tracking stock called LiLAC for its existing assets in Latin America and the Caribbean that gives Malone a new balance sheet from which to start consolidating local assets.