Retailer HSN preps for spinoff from IAC
Home & Textiles Today Staff -- Home Textiles Today, November 5, 2007
New York – IAC/InterActiveCorp, the multi-faceted media, retail and interactive services conglomerate built by financier Barry Diller plans to break itself into five publicly traded companies, with the spinoffs – including retailer HSN (Home Shopping Network) expected to be completed by the second or third quarter of 2008, the company said today.
IAC had total 2006 revenues of $6.3 billion, of which the retail division generated about $3.3 billion.
Diller, chairman and ceo of IAC, noted that it has been a complex enterprise from its start 12 years ago, and it was likely to attract investors more readily if each of its major divisions could tell its own business story more simply. “Now that we have real scale in the pure internet units, it makes nothing but sense to me to reorganize the whole,” he said.
The five separate companies will be: IAC, Ticketmaster, Interval International, LendingTree, and HSN.
“HSN I believe now has a solid strategy and the leadership to thrive as a ‘pure play’ retailer,” added Diller during a conference call earlier today. The company said Mindy Grossman will continue as ceo of HSN.
The HSN spinoff entity will include the main IAC retailing units, including HSN TV and hsn.com; coupled with the Cornerstone Brands portfolio of catalogs, websites and retail locations that include Alsto’s, Ballard Designs, Frontgate, Garnet Hill, GrandinRoad, Improvements, Isabella Bird, Smith+Noble, The Territory Ahead and TravelSmith.
Together, according to HTT research, Cornerstone and HSN did $242 million in 2006 home textiles sales, with Cornerstone at No. 27 and HSN at No. 50 in the HTT Top 50 Retailing Giants.
Taking questions from investors, Diller pitched his belief that none of the separate companies would incur major new infrastructure costs, as each already has its own strata of management and departmental strengths.
On a separate front, “just hours ago,” IAC said it reached an agreement for Google to be IAC’s “sponsored listing provider” for the next 5 years – a marketing deal IAC said would generate in excess of $3.5 billion.
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