In-flight Entertainment
Wednesday, January 05, 2011
 

JetBlue and LiveTV to Split; LiveTV Spin-off Imminent

An anonymous source (KingOfIndiana) told us today that JetBlue is currently in serious negotiations to spin-off LiveTV as a separate business entity. Lawyers for JetBlue and LiveTV are currently meeting in New York City to iron out the details. JetBlue purchased Melbourne, Fla.-based LiveTV for $81 million in 2002. That transaction included $41 million in cash and the assumption of $40 million of LiveTV debt.

LiveTV offers several highly-profitable products. Most famous is their Live Satellite Television antenna and IFE system. The company also manufactures:
  • XM passenger radio kits
  • Kiteline, a BlackBerry text messaging service
  • LiveTV Airfone, an Air-To-Ground communication service marketed towards the General Aviation (VIP) market.
This paragraph from JetBlue's April 2008 earnings statement basically foretells the LiveTV sell-off:
On April 22, 2008, we stated that we were considering a range of strategic alternatives for our LiveTV business, which provides in-flight entertainment systems and data connectivity services for commercial aircraft operated both by us and by third parties. We further stated that it might be a few quarters until we have prioritized our options regarding these alternatives. Morgan Stanley is serving as our financial advisor. We cannot predict the outcome of our consideration, or whether it will result in the occurrence of any transaction.
 


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