A battle of two media titans opened Monday in a Delaware court, and popular companies such as Ticketmaster and Home Shopping Network may be up for grabs. John Malone, chairman of Douglas County-based Liberty Media Corp., took the stand, facing off against Barry Diller, chief executive of Manhattan-based IAC/Interactive.
At issue is whether Liberty would retain its supervoting proxy status if Diller proceeds with plans to divide IAC into five separate entities.
Malone termed a move by Diller to shut him out of decisions at IAC “a crossing of the Rubicon.”
“The idea of excluding us completely from the boards seemed to me pretty outrageous,” Malone testified.
According to Forbes magazine’s 2008 list of the world’s billionaires, Malone ranks 553rd with assets totaling $2.2 billion. Diller is 897th with $1.3 billion.
Diller is an outgoing and flashy operator, soaking up the public spotlight. Malone is an introverted financial mastermind, rarely giving interviews or making public appearances.
“It’s a great story for the media that these two are pulling out swords,” said Jimmy Schaeffler, senior multichannel analyst for the Carmel Group. “This is a big old poker game. . . . Malone’s weakness is somewhat his omission, the things he doesn’t do. It’s an art, and some do it well, and some don’t do it well.”
Diller’s IAC conglomerate contains more than 60 companies, many of them Internet brands, such as , Evite, Citysearch, and LendingTree.
But the company, which started in 1995, has Liberty as its premier investor. Diller amassed his wide range of assets over the years with Malone’s help — and cash. Liberty owns about 30 percent of IAC’s stock and controls about 62 percent of the voting power.
But Malone allowed Diller to control Liberty’s votes until Diller’s decision in November to break up IAC because of its sagging stock price. The move also aimed to eliminate Malone’s supervoting power.
Malone, an Ivy League financier and engineer, came to Denver in the 1970s to run cable company Tele-Communications Inc. for Bob Magness and made his fortune when he sold it to AT&T in 1999.
Liberty Media spokesman John Orr declined to comment. IAC did not return calls for comment.
The Associated Press contributed to this report.
Kimberly S. Johnson: 303-954-1088 or kjohnson@denverpost.com
What’s at stake
In November, IAC/Interactive announced plans to divide the company, with more than 60 businesses, into five separate entities:
• Home Shopping Network, including the primary businesses composing IAC’s retailing segment
• Ticketmaster
• Interval International, which would include CondoDirect and
• LendingTree
• IAC, including IAC’s media and advertising sector, , , ServiceMagic and businesses such as Black Web Enterprises that compose its emerging- businesses sector
