Diller Exits IAC CEO Role as Malone Exchanges Stake
Barry Diller stepped down as chief executive officer of IAC (IACI)/InterActiveCorp., naming Greg Blatt as his replacement, and John Malone exchanged his holdings in IAC for two online businesses and about $220 million in cash.
Blatt, 42, joined IAC in 2003 as general counsel and was named CEO of the company’s Match.com business last year, the company said in a statement. Diller will take on the role of chairman and senior executive, IAC said.
“It’s been clear to me for some time that this company needs a full time, aggressive and inspirational executive in the CEO role,” Diller, 68, said in the statement. “While I’m not going anywhere, IAC, with its operating businesses growing, large cash resources and virtually no debt, needs the kind of leadership that Greg Blatt can bring it in order to continue to grow and thrive.”
Before joining IAC, Blatt worked at Martha Stewart Living Omnimedia. (MSO) Earlier, he had been an associate at New York law firms Grubman Indursky & Schindler, as well as Wachtell, Lipton, Rosen & Katz, the company said.
Separately, Malone, the chairman of Liberty Media Corp., exchanged his company’s 12.8 million shares in IAC for ownership of Evite and Gifts.com and $220 million in cash. As a result of the transaction, Diller has a holding that represents more than a third of the votes in IAC stock. He was also granted the right to increase his IAC stake within the next 9 months to give him a total of 41 percent of the votes in the company.
“What IAC has given up to buy out Malone’s stake seems very reasonable from an IAC shareholder’s point of view,” said Sandy Mehta, an analyst at Hong Kong-based Value Investment Principals Ltd., which holds stock in the company.
Diller’s exit from the chief executive’s job is a positive step because he has broader interests, the analyst said.
“You really need a 100 percent hands-on CEO,” Mehta said in an interview.
IAC rose 63 cents, or 2.2 percent, to $29.35 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have risen 43 percent this year.
Liberty Interactive, the Liberty Media tracking stock that includes the QVC home shopping channel and will include the businesses acquired from IAC, rose 19 cents to $15.91. The shares have gained 47 percent this year.
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