Madison Square Board OKs Spin-Off Of Sports And Entertainment Businesses

(RTTNews) - The Madison Square Garden Co (MSG) on Friday said its board has approved the spin-off of its sports and entertainment businesses from its media business.

Upon completion of the spin-off, MSG will be a standalone media company and will change its name to MSG Networks Inc and the newly formed sports and entertainment company will be called The Madison Square Garden Co.

The distribution will take place on September 30 to MSG stockholders of record as of the close of business on September 21.

For the distribution, each MSG Class A common stockholder will receive one share of the new Madison Square Garden Co Class A stock for every three shares of MSG Class A stock held as of the record date.

Each MSG Class B common stockholder will receive one share of the new Madison Square Garden Company Class B common stock for every three shares of MSG Class B common stock they hold as of the record date.

Upon completion of the spin-off, MSG's current repurchase program, through which $241 million of MSG Class A stock has already been purchased, will be terminated and the new Madison Square Garden Co will have in place new Board authorization to repurchase up to $525 million of its Class A stock.

The spin-off has been structured to qualify as a tax-free distribution to MSG stockholders for U.S. federal income tax purposes. Cash received in lieu of fractional shares, however, will generally be taxable.

Beginning on September 17 and continuing until the occurrence of the distribution, MSG expects that its stock will trade in two markets on the NYSE: In the "regular way" market under the symbol "MSG" and under the current name, "The Madison Square Garden Co", and in the "ex-distribution" market under the symbol "MSGN WI" and under the new name "MSG Networks Inc."

The new Madison Square Garden Company Class A common stock is expected to begin trading on a "when-issued" basis on the NYSE under the symbol "MSG WI" and under the name "The Madison Square Garden Co" beginning on September 17.

The completion of the spin-off is subject to the effectiveness of MSG's Form 10, funding of the debt financing at MSG Networks and the new Madison Square Garden Co stock being authorized for listing on the NYSE, as well as certain approvals and consents.