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Liberty Interactive to Buy Alaskan Cable Operator GCI in $1.1B Deal

In typical complicated fashion, cable legend John Malone’s (pictured) Liberty Interactive will purchase Alaskan cable and telephone company General Communication Inc. in a deal worth $1.1 billion that will also pair the distributor with his QVC Group home shopping operations.

GCI has about 108,000 cable subscribers in Alaska and also is the state’s largest telephone and wireless company. The deal is expected to close in the first quarter of 2018. J.P. Morgan is serving as financial advisor and Baker Botts LLP is serving as legal advisor to Liberty Interactive.

The deal has two immediate benefits for Liberty Interactive—it transforms the stock from a tracking stock to an asset-based equity which would allow it to be included in major stock indices, and it creates a more robust currency for other deals and for management compensation. For GCI, it gets a big-pocketed backer and the resources to possibly roll up more cable companies across the country. It also is a bit of a homecoming for the Alaskan cabler, which was once part of Liberty’s former parent Tele-Communications Inc. (TCI)

GCI stock, traded under the symbol GCNMA, soared on news of the deal, up nearly 60% ($12.20 per share) to $32.76 in early trading Tuesday. Liberty Interactive shares were up nearly 5% (93 cents each) in early Tuesday trading to $20.90 per share.

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