NEW YORK, Jan. 29 /PRNewswire-FirstCall/ -- IAC (Nasdaq: IACI) today
issued a statement regarding a lawsuit by Liberty Media.
Last night, Liberty Media took the extraordinary action of attempting
to claim control of the voting power of IAC and replacing a majority of its
directors. The action is preposterous. Liberty does not control IAC. Barry
Diller continues to be the Chairman and CEO of IAC, the Board of Directors
of IAC elected at last summer's stockholders meeting continues to manage
the affairs of the Company, and IAC management continues to work in the
best interest of its stockholders toward consummation of the previously
announced transactions in which it will separate into 5 public companies.
The chain of events that led to this point is quite simple. Mr. Diller
recommended to IAC's Board of Directors earlier this month that IAC's
previously announced spin-off transactions be structured so that all
shareholders receive the same class of stock in the resulting companies,
while IAC continues with its dual class stock structure. This
recommendation was made because a dual class voting structure, like that of
IAC, was far less compatible with the fundamental business rationale
driving the Board's spin-off, which was unanimously approved last November
by IAC's Board of Directors, including Liberty's two Board designees. Mr.
Diller was very clear at its January Board meeting that the Board was not
being asked to act upon this recommendation at the meeting, but would be
given further time to deliberate on the issue, including additional
discussions with management and advisors, prior to a Board vote. The Board
in fact took no formal action relating to the issue. At the meeting,
Liberty objected to the single class structure, alleging that this would
violate various contractual and legal obligations. As a result, IAC and Mr.
Diller filed an action in Delaware court to seek affirmation of its view of
their rights. It did this so that a court could promptly resolve the
dispute before either IAC, its shareholders, or Liberty could be injured by
any one taking definitive actions based on conflicting interpretations of
the governing documents.
Despite this well intentioned effort at peaceful resolution, Liberty
has now gone off the deep end, not only alleging that Mr. Diller has
somehow materially breached his proxy by which he has voted Liberty's IAC
shares for over 12 years, but also purporting to unilaterally throw out the
incumbent directors and installing its own slate.
Regardless of whether IAC and Mr. Diller are correct about their rights
to effect a single-class voting structure in the spin-offs, which they are
confident they are, the contention that Liberty is now in control of the
Company is inexplicable. Nothing has happened yet. No Board has decided
anything. No shareholders have voted (or been asked to vote) on anything.
No agreements have been signed. The requisite filings have not been made
with the SEC. No transactions have been consummated. Even after reading the
various complaints repeatedly, Liberty's theory that it now controls IAC is
This action is a desperate sideshow designed to exert pressure on the
Board and management of IAC as they attempt to responsibly act in the best
interest of their stockholders. All it demonstrates is that Liberty will
stop at nothing to advance their own interests at the expense of the other
stockholders. Needless to say, IAC will not be daunted. IAC and Mr. Diller
are highly confident that they will prevail on the merits of the ongoing
litigation, and regret the fact that IAC's employees and stockholders have
been exposed to such reckless and frivolous actions.
IAC operates leading and diversified businesses in sectors being
transformed by the internet, online and offline... our mission is to
harness the power of interactivity to make daily life easier and more
productive for people all over the world. To view a full list of the
companies of IAC please visit our website at http://iac.com.
IAC Communications Office IAC Investor Relations
Stacy Simpson/ Leslie Cafferty Eoin Ryan
(212) 314-7470/ 7326 (212) 314-7400