Liberty Media Corp. will pay $220.7 million to settle or exchange two swap contracts, saying recent drops in the company's bond prices let the investors who bought the swaps demand repayment.
Liberty will reduce debt by $124.8 million as part of the refinancing, the Englewood, Colorado-based company said today in a statement. It will pay for the moves with existing cash and money borrowed against its holdings in other media companies.
The shift is the latest sign of how Liberty and Chairman John Malone have been coping with the credit crisis. Malone said Oct. 30 that he had sold 4.5 million shares of the company's Liberty Capital tracking stock, which reflects the performance of investments in companies such as Time Warner Inc. and Motorola Inc., to pay back personal debt.
Liberty owns the QVC (LINTA:US) home shopping channel and Starz cable network. It also has investments in other companies, the largest of which is a 49 percent voting stake in satellite TV company DirecTV Group Inc., worth about $12 billion.
Liberty Capital fell 21 cents to $6.60 at 4 p.m. New York time in Nasdaq Stock Market trading (LCAPA:US). It has dropped 46 percent this year.
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