IAC to spin-off travel firm
- Added:
- Dec 22, 2004
IAC said its growth is being hindered by the perception that it is strictly a travel company.
The move means the US-based firm can concentrate on expanding its portfolio of social networking, personal finance and shopping sites, including Ticketmaster, the Home Shopping Network, CitySearch and match.com.
Barry Diller, CEO at IAC said: "The result of our success in travel, and its present overweighting, is that IAC is viewed by the world as a travel company, We've come to discover that this perception actually hinders the ability of our company to grow, both outside travel and inside of it."
The spin-off will take the form of a reclassification of IAC shares, with IAC shareholders receiving a proportionate amount of Expedia stock in a tax-free deal.
Diller will stay as chairman and chief executive of IAC, while Expedia will be run by Diller as chairman and Dara Khosrowshahi as CEO.
Diller said that Expedia has experienced "tremendous" growth "to the point where they now represent over 50% of IAC's earnings, and dwarf each of our other operations."
The spin-off is expected to be complete in the second-quarter of 2005, when the travel businesses will become a public company called Expedia.