IAC/InterActiveCorp (NASDAQ: IAC) has announced that it made a preliminary proposal for a full separation with Match Group Inc. (NASDAQ: MTCH). This follows IAC’s August announcement that it was considering such a separation.
In the proposed transaction, IAC would effectively distribute its shares in Match to IAC’s stockholders, resulting in two independent public companies. The transaction, which would be structured to be tax-free to IAC, Match and their respective stockholders, also would eliminate the dual-class common stock structure at Match, with all pre-transaction stockholders of Match and IAC receiving a single class of “one share/one vote” capital stock of the resulting Match. Pre-transaction stockholders of IAC would receive stock in new IAC replicating their current interest in IAC.
Note that this still requires approval of the IAC board of directors, a favorable recommendation of the Match special committee, any required approvals of stockholders of both IAC and Match, and approval by the disinterested stockholders of Match, among other customary conditions.
Joey Levin, CEO of IAC, commented:
Today IAC proposed an important first step in the separation of Match Group from IAC. IAC is confident that the proposal communicated to the Match Group special committee provides strong footing for Match Group to begin its journey as a thriving, independent company.
As it relates to evaluating our ownership stake in ANGI Homeservices. We don’t currently expect to turn our attention to the question of a spin-off until a Match Group transaction has been completed.
Shares of IAC were traded up about 1% to $226.60 on Friday, in a 52-week range of $158.29 to $268.72. The consensus price target is $300.55.
Match traded down 3% to $73.44 a share. The 52-week range is $33.30 to $95.32, and the consensus price target is $90.00.