Allen to Sell 55% Stake in Ticketmaster

Giving up his dream of making Ticketmaster Corp. a centerpiece of his new-media empire, billionaire Paul Allen has reached an agreement to sell his 55% stake in the Los Angeles-based ticketing giant to Home Shopping Network Inc. for $17 a share, sources said Monday.

The deal gives Allen a 33% premium over Ticketmaster’s current market price. Although details were unavailable, the deal appears to value the billionaire’s stake at roughly $230 million.

Fred Rosen will remain chief executive of Ticketmaster. Rosen will also serve on the board of the Home Shopping Network, which is controlled by media mogul Barry Diller.

It is unclear whether the sale is related to a bitter conflict between Microsoft Corp. and Ticketmaster.

Rosen recently sued Microsoft when the software giant established links from its entertainment site on the World Wide Web directly to Ticketmaster’s own Web site. Rosen accused Microsoft of exploiting the Ticketmaster site without Ticketmaster’s permission.

The lawsuit has put Allen in an awkward position. Allen is a member of Microsoft’s board and is the company’s second-largest shareholder.

Allen originally paid more than $300 million for 80% of Ticketmaster in 1993 with hopes of creating synergies between his various Internet companies, such as Starwave, and the ticketing agency.

Allen hoped, for example, to use Ticketmaster as a base to handle a large number of transactions. Although Ticketmaster does have an Internet site, it remains a small proportion of the company’s overall business.

Allen’s retreat began in November, when Ticketmaster issued a public offering at $14.50 a share.

Ticketmaster shares fell 25 cents to $12.75 on Nasdaq on Monday.

Barry Diller, chairman of Home Shopping Network, initiated the transaction, according to those close to the deal. Diller was apparently interested in using Ticketmaster’s extensive telephone network to sell a broad range of products.

There is also some speculation that Diller would use the television channel to promote entertainment and sell merchandise related to bands and other shows handled by Ticketmaster.