January 2008
Belo Corp. (NYSE: BLC) announced that the Company has received a private letter ruling from the Internal Revenue Service confirming that the previously announced decision to spin off the Company's newspaper businesses and related assets will qualify as a tax-free distribution to Belo shareholders for U.S. federal income tax purposes. Belo also announced today the filing of its information statement on Form 10 with the Securities and Exchange Commission.
These two events are important steps in the completion of the spin-off transaction, which is scheduled to close on the distribution date, February 8, 2008. On January 11, 2008, the Company released details of the spin-off transaction as approved by the Board of Directors, including the distribution date, the record date and the distribution ratio of the transaction.
As noted in the Belo press release issued on December 4, 2007, the Company is engaged in performing its annual impairment testing of goodwill and other intangible assets using the methodology prescribed by Statement of Financial Accounting Standards No. 142. The testing is nearing completion and the Company continues to expect to record a non-cash impairment charge for the fourth quarter of 2007. While the charge is expected to be significant from a reported GAAP earnings perspective, it will be a non-cash charge and will not affect the Company's liquidity, cash flows from operating activities or debt covenants, or have any impact on future operations.
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