DENVER—It’s not shareholders or taxes but John Malone himself at the center of a lingering issue delaying Liberty Media’s long-awaited acquisition of a stake in satellite television provider DirecTV.
Malone is chairman of both Liberty Media Corp. and of Liberty Global Inc., which operates a cable television service that competes with DirecTV in Puerto Rico. Government officials have questions about keeping the businesses separate if the acquisition is approved, Liberty Media Chief Executive Officer Greg Maffei said Wednesday.
Liberty Media executives are in negotiations to reach a resolution with hopes of finalizing the acquisition in the near future, Maffei told analysts during the Citi Investment Research 18th Annual Global Entertainment conference.
“We’re very close. And whether it comes down to an information flow or it comes down to something more concrete, like a divestiture plan for one or the other of the Puerto Rican businesses,” Maffei said.
It’s been a little more than a year since Liberty Media, based in suburban Englewood, agreed to acquire a 38.5 percent stake in DirecTV from Rupert Murdoch’s News Corp.
Under the plan, Liberty Media would exchange its roughly $11 billion stake in News Corp. plus $550 million in cash for News Corp.’s stake in DirecTV.
Janco Partners analyst April Horace said Thursday she believes the agreement eventually will receive approval from the Federal Communications Commission and the Justice Department.
The overlap in Puerto Rico is small, she noted. DirecTV has about 70,000 subscribers there, which is less than one-half of 1 percent of its overall customer base.
Malone founded Liberty Media, whose assets are divided into two groups: Liberty Interactive Group, which includes QVC home shopping network and other e-commerce businesses, and Liberty Capital Group, consisting of cable television channel Starz Entertainment LLC and other entertainment businesses. Each has its own tracking stock.
When the DirecTV acquisition is final, Liberty Media will include a third unit called Liberty Entertainment Group encompassing interests in DirecTV, Starz, WildBlue Communications Inc., a rural satellite broadband company, and Fun Technologies Inc.
Liberty Global is an international cable television service provider which was spun off by Liberty Media.
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