Liberty Interactive Corp. and General Communications Inc. have entered into an agreement for Liberty to acquire GCI .
The split-off of Liberty Interactive’s interest in GCI Liberty is expected to be completed by the first quarter of 2018. The transaction is subject to regulatory review, the companies said in a joint announcement April 4.
The announcement said the exact purchase price would be determined at the closing, but Reuters was reporting the transaction as a $1.12 billion deal.
Ron Duncan, GCI co-founder, president and chief executive officer, said that as part of a larger company, GCI would be even better positioned to compete, innovate and serve Alaskans and other customers in the Lower 48.
GCI’s Terrestrial for Every Rural Region in Alaska (TERRA) network connects a number of rural Alaska villages to terrestrial broadband and increased Internet capabilities.
GCI will remain a freestanding operation within GCI Liberty, with no changes in its leadership team, brand, operations, products and services as a result of the transaction, Duncan said. Company headquarters will remain in Anchorage.
GCI will become the largest operating asset in GCI Liberty’s portfolio of assets, which also includes a minority equity interest in Charter Communications, the second largest cable company in the U.S.
The deal will also triple the value of GCI and Duncan will serve on the GCI Liberty board of directors, said Heather Handyside, a spokeswoman for GCI.
Liberty Interaction operates and owns interests in a broad range of digital commerce businesses, which are currently attributed to two tracking stock groups: the QVC Group and Liberty Ventures Group.
GCI is the largest communications provider in Alaska, offering data, wireless, video, voice and managed services to consumer and business customers throughout Alaska and the Lower 48 states.
Greg Maffei, Liberty Interactive president and chief executive officer, said the transaction would ultimately create a standalone Liberty Ventures, reducing the tracking stock discount and enabling an asset-backed QVC Group.
The deal would also produce strong free cash flow allowing for potential stock repurchases, and provide financial flexibility for future borrowings.
