Belo Board of Directors Approves Spin-Off Details That Will Create Separate Television and Newspaper Businesses
January 11 2008 - 1:59PM
PR Newswire (US)
DALLAS, Jan. 11 /PRNewswire-FirstCall/ -- Belo Corp. (NYSE:BLC)
announced today that its Board of Directors has approved details of
the Company's previously-announced plan to create separate
television and newspaper businesses through the spin-off of its
newspapers and related assets into a publicly-traded company called
A. H. Belo Corporation. The transaction will be completed through a
special tax-free stock dividend distribution to shareholders on all
outstanding shares of Belo Corp. common stock. The Board has
established the close of business on January 25, 2008 as the record
date and set a distribution ratio of 0.20 A. H. Belo shares for
each share of Belo Corp. The distribution of A. H. Belo common
stock is expected to occur on February 8, 2008 to Belo Corp.
shareholders of record. Series A common stock of A. H. Belo will
begin regular trading on the New York Stock Exchange under the
ticker symbol AHC on February 11, 2008 and Series A common stock of
Belo Corp. will continue to trade on the NYSE under the ticker
symbol BLC. No fractional AHC shares will be distributed and cash
will be paid in lieu of fractional shares. Belo Corp. has requested
a ruling from the Internal Revenue Service indicating that the
spin-off will qualify as a tax-free distribution to Belo Corp.
shareholders for U.S. federal income tax purposes. The Company
expects to receive the ruling, which is a condition to the
spin-off, by the end of the month. Any cash received by a Belo
Corp. shareholder in lieu of fractional AHC shares will be taxable.
Belo Corp.'s Series A common stock will continue to trade "regular
way" (inclusive of the A. H. Belo Series A common stock
distribution) throughout the period leading up to and including the
distribution date. Any holder of Belo Corp.'s Series A common stock
who sells shares "regular way" on or before the distribution date
will also be selling the entitlement to receive shares of A. H.
Belo Series A common stock on the distribution date. On the first
day of trading following the distribution date, all shares of Belo
Corp. Series A common stock will trade without the benefit of the
A. H. Belo Series A common stock distribution, and A. H. Belo
Series A common stock will begin to trade independently on a
"regular way" basis. Belo Corp. has been advised by the NYSE that
shares of AHC and BLC are expected to begin trading on a "when
issued" basis on January 23, 2008, two business days prior to the
record date, and continue through the distribution date of February
8, 2008. If such "when issued" markets develop, then "when issued"
AHC shares will be traded under the symbol "AHC wi". "When issued"
BLC shares, which will not include an entitlement to receive AHC
shares in the stock dividend distribution, will be traded under the
symbol "BLC wi". Investors are encouraged to consult with their
financial advisors regarding the specific implications of trading
AHC or BLC common stock on or before the distribution date. The
distribution ratio of 0.20 means that there will be approximately
17.6 million shares of A. H. Belo Series A shares outstanding at
the spin-off and approximately 2.9 million shares of A. H. Belo
Series B shares outstanding. Although A. H. Belo Series B shares do
not trade on any exchange, they are convertible into Series A
shares at any time on a one-to-one basis. "This is an exciting step
in Belo's strategic plan to enhance shareholder value by creating
separate television and newspaper companies that will be very
focused and responsive to changing industry dynamics," said Robert
W. Decherd, Chairman and Chief Executive Officer. "We remain
committed to delivering the highest quality news and information to
our loyal audiences and advertisers as we finalize the spin-off.
The transaction will deliver many benefits by the flexibility it
affords to both companies." Following the spin-off, Belo Corp.
currently plans to pay an annual dividend of approximately $0.30
per share, paid quarterly, and A. H. Belo currently plans to pay an
annual dividend of approximately $1.00 per share, paid quarterly,
after adjusting for the 0.20 distribution ratio. The actual amount
and timing of each dividend are subject to final determination by
the boards of the two companies. No action is required by Belo
Corp. shareholders to receive their A. H. Belo common stock and
Belo Corp. shareholders will not be required to surrender or
exchange their shares. Registered owners of Belo Corp. Series A
common stock who are entitled to receive the distribution will
receive a book entry statement from The Bank of New York Mellon
reflecting their ownership of A. H. Belo Series A common stock.
Holders of Belo Corp. Series A stock who hold their shares through
a bank, broker or other entity will have their brokerage account
credited with the A. H. Belo Series A common stock. Physical stock
certificates for Series A common stock will not be issued unless a
shareholder requests certificates from the transfer agent and
provides the required information. Registered owners of Belo Corp.
Series B common stock who are entitled to receive the distribution
of A. H. Belo Series B common stock will receive physical stock
certificates. Completion of the distribution is subject to
customary conditions set forth in a separation and distribution
agreement to be filed with the U.S. Securities and Exchange
Commission (SEC) as an exhibit to A. H. Belo's information
statement on Form 10. After the record date, Belo Corp. will mail
an information statement to all holders of Belo Corp. common stock,
which will include information regarding the procedures by which
the distribution will be effected, the business and management of
A. H. Belo following the distribution, and other information of
interest to Belo Corp. and A. H. Belo shareholders. The information
statement will also be available through the SEC's Web site at
http://www.sec.gov/ and on the Belo Corp. and A. H. Belo Web sites
at http://www.belo.com/ and http://www.ahbelo.com/. About Belo Belo
Corp. is one of the nation's largest media companies with a
diversified group of market-leading television, newspaper, cable
and interactive media assets. A Fortune 1000 company with 7,000
employees and approximately $1.6 billion in annual revenues, Belo
operates in some of America's most dynamic markets in Texas, the
Northwest, the Southwest, the Mid-Atlantic and Rhode Island. Belo
owns 20 television stations, six of which are in the 15 largest
U.S. broadcast markets. The Company also owns or operates six cable
news stations and manages one television station through a local
marketing agreement. Belo's daily newspapers are The Dallas Morning
News, The Providence Journal, The Press-Enterprise (Riverside, CA)
and the Denton Record-Chronicle (Denton, TX). The Company also
publishes specialty publications targeting young adults, and the
fast-growing Hispanic market, including Quick and Al Dia in
Dallas/Fort Worth, and El D and La Prensa in Riverside. Belo
operates more than 30 Web sites associated with its operating
companies. Additional information is available at
http://www.belo.com/ or by contacting Paul Fry, vice
president/Investor Relations & Corporate Communications, at
214-977-6835. Statements in this communication concerning Belo's
business outlook or future economic performance, anticipated
profitability, revenue, expenses, dividends, capital expenditures,
investments, future financings, or other financial and
non-financial items that are not historical facts, are
"forward-looking statements" as the term is defined under
applicable federal securities laws. Forward-looking statements are
subject to risks, uncertainties and other factors that could cause
actual results to differ materially from those statements. Such
risks, uncertainties and factors include, but are not limited to,
uncertainties regarding the execution, timing, costs, consequences
(including tax consequences), and other effects of the spin-off of
the newspaper business of Belo; changes in capital market
conditions and prospects, and other factors such as changes in
advertising demand, interest rates and newsprint prices; newspaper
circulation matters, including changes in readership patterns and
demography, and audits and related actions by the Audit Bureau of
Circulations; technological changes, including the transition to
digital television and the development of new systems to distribute
television and other audio-visual content; development of Internet
commerce; industry cycles; changes in pricing or other actions by
competitors and suppliers; Federal Communications Commission and
other regulatory changes; adoption of new accounting standards or
changes in existing accounting standards by the Financial
Accounting Standards Board or other accounting standard-setting
bodies or authorities; the effects of Company acquisitions and
dispositions; general economic conditions; and significant armed
conflict, as well as other risks detailed in Belo's other public
disclosures, and filings with the Securities and Exchange
Commission ("SEC") including the Annual Report on Form 10-K.
DATASOURCE: Belo Corp. CONTACT: Paul Fry, vice president of
Investor Relations & Corporate Communications of Belo Corp.,
+1-214-977-6835 Web site: http://www.belo.com/
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