By Paul R. La Monica

IAC, the Barry Diller-backed conglomerate that has a history of incubating companies and then spinning them off, is considering another deal.

IAC said Monday that it may look to distribute its 85% stake in Angi, the home-services unit formerly known as Angie's List, which IAC bought in 2017, to shareholders. It made the announcement in conjunction with its latest earnings report, released after the closing bell.

The company posted a wider-than-expected net loss of $243.7 million, or $2.93 share. Revenue came in at $938.7 million, down 16% from a year ago but ahead of the Wall Street consensus forecast of $923 million.

Angi, which also reported its third-quarter results, said its revenue fell 16% as well, It posted an operating profit of $8 million, reversing a loss from a year ago. The stock, which is already publicly traded, was up more than 4% shortly before the close on Monday.

IAC has risen 2.6%.

If IAC does decide to fully spin off Angi, it would join 10 other former IAC-owned companies, including Expedia, Ticketmaster (now part of Live Nation), Tripadvisor, and Match Group as stand-alone firms.

IAC CEO Joey Levin said in an interview with Barron's that the potential Angi spinoff would allow IAC to "slim the portfolio in order to think more clearly about the future."

A spinoff would leave IAC with three core businesses: Dotdash Meredith, the digital and print media firm that owns People, Allrecipes, Southern Living, and Investopedia, to name a few; the Ask.com search business, formerly known as Ask Jeeves; and Care.com, an online marketplace for family care services. IAC said Monday that beginning in the fourth quarter, it will specifically break out Care.com results in its financial statements.

IAC also owns more than 20% of the casino and online betting company MGM Resorts, as well as a 32% stake in Turo, the privately held car sharing marketplace.

The question now for IAC is what it might do next? IAC had been exploring the idea of buying media company Paramount Global. But Diller, who is IAC's chairman and senior executive, said in an interview with CNBC in July that the deal wouldn't happen given that Skydance Media, the company run by David Ellison, the son of Oracle co-founder Larry Ellison, had agreed to a merger with Paramount.

Levin told Barron's that IAC's next big investment is unlikely to be a large media company, noting that a possible deal for the CBS owner would have been an opportunistic move. He didn't rule out the idea that IAC could increase its stake in MGM Resorts, saying that "anything is on the table."

IAC investors are probably hoping that the next big investment can boost the stock. Shares of both IAC and Angi are up by percentages in the mid single digits this year, trailing behind the broader market.

Write to Paul R. La Monica at paul.lamonica@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

November 11, 2024 16:05 ET (21:05 GMT)

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