Liberty Interactive plans to sell 12 million shares of Expedia Inc. in a block trade for around $414 million, thus cutting its stake in the online travel company by more than half.
Prior to the transaction, which is to begin today and to be completed March 30, Liberty owned about 18% of Expedia's more than 120.8 million shares of common stock.
In a transaction handled by UBS, Liberty plans to sell the shares March 27 at a re-offer price of $34.50 per share, a 2.7% discount to the $35.44 last sale price on March 26.
The timing of the move comes as surprise, although rumblings and maneuverings in the longtime Barry Diller-Liberty alliance have been apparent since Liberty eliminated its stake in Diller's IAC in December 2010.
There can be numerous interpretations of what Liberty is up to. Representatives of Liberty and Expedia didn't immediately respond to requests for comment.
However, one reading of Liberty's transaction, in taking a reduced stake in Expedia, is that it shines an even brighter light on the new big man on campus, the recently spun off TripAdvisor.
Of course, the transaction might merely be an opportunistic financial deal.
Barry Diller, with Liberty's agreement, controls both Expedia and TripAdvisor.
Now, while Liberty is downsizing its stake in Expedia to about 8% of the common stock from its previous 18%, there has been no corresponding pullback of Liberty's stake in TripAdvisor.
"Liberty Interactive and its affiliates own stock of TripAdvisor representing 62.4% by vote and 30.5% beneficial ownership," TripAdvisor states in a financial filing.
Does Liberty see the media company, TripAdvisor, as a more strategic investment than the transaction company, Expedia?
TripAdvisor has been feeling its oats of late, trumpeting itself as "the world's largest travel site," a boast that Expedia used to make before Priceline made its growth spurt.
So now Liberty's sale of 12 million shares of Expedia stock can only boost TripAdvisor's profile in the eyes of many.