LodgeNet is actually buying all the capital stock of Ascent Entertainment Group, which owns 100% of the capital stock of On Command, from Liberty Media and its Liberty Satellite & Technology subsidiary.
The deal involves both 2.05 million shares of LodgeNet common stock and $332 million in cash. Part of the cash will come from selling 1 million LodgeNet shares to long-time investor PAR Capital Management for approximately $23 million. Liberty will end up owning approximately 9.9% of LodgeNet’s common stock. The transaction is expected to close in mid-2007.
On Command provides interactive media services to approximately 830,000 hotel rooms throughout the United States, Canada, and Mexico. It also owns 80% of the capital stock of The Hotel Networks, the distributor of advertising-supported, satellite-delivered television programming to approximately 300,000 rooms throughout the United States.