Billionaire John Malone's Liberty Interactive Corp will increase its stake in HSN for $1.3 billion in stock to acquire full control, consolidating its hold on home-shopping services as the retail and television industries undergo seismic changes.
The move by Liberty, which also owns the QVC network, comes as Amazon. com and Wal-Mart Stores become the dominant players in online retail and more people drop their cable subscriptions to watch TV online.
"The increased scale of this combination will allow us to more effectively compete, we think, in the changing and evolving retail and digital environment," said Liberty Interactive chief executive Greg Maffei.
The deal values HSN at $40.36 apiece, a premium of 29 per cent over the closing price on Wednesday.
Mr Maffei estimated the deal would produce $75 million to $110 million in cost savings each year, but he noted: “It’s a difficult time in the retail market.”
The combined QVC and HSN companies will be able to tackle changing shopping habits as well as the shifting media landscape by speeding up innovation and offering more brands and products, QVC chief executive Mike George said.
QVC and HSN will continue to operate as distinct brands. Mr Malone has extensive business interests in Ireland, including owning Virgin Media, TV3 and a number of hotels. – (Bloomberg)
