Match Group Inc. (NASDAQ: MTCH) and IAC/InterActiveCorp (NASDAQ: IAC) announced Thursday morning that the two companies are getting divorced. Match, which has been operating as a subsidiary of IAC since an IPO in late 2015, will become a fully independent company upon completion of the transaction, currently projected for the second quarter of 2020. Match owns a number of dating sites, the best known of which is Tinder. Both existing companies will be replaced by new versions, called New IAC and New Match in a presentation available at the IAC website.

Under the terms of the deal, current public shareholders of Match Group will receive one share of common stock in New Match along with $3.00 in cash per share of Match Group stock. IAC shareholders will receive $3.00 per share of IAC stock in cash (up to $160 million in aggregate). Match Group will fund the cash considerations, which the companies estimate will total about $840 million.

According to the presentation, “Each holder of IAC common stock or IAC Class B common stock will receive an equivalent interest in New IAC, and an interest in New Match based on IAC’s ownership of Match pre-transaction, subject to transaction-related adjustments.” The value of each IAC share includes the value of 2.6 Match Group shares. At Wednesday’s closing price of $73.60, Match’s share price implies a value of $185.22 in each share of IAC stock.

Angi Homeservices Inc. (NASDAQ: ANGI), the other publicly traded subsidiary of IAC, closed Wednesday at $8.28. Each IAC share includes 4.8 shares of Angi that would be valued at about $39.74. Added together, Angi and Match are worth $224.96 a share. IAC’s closing price on Wednesday was $221.21.

Barry Diller, board chair and senior executive of IAC, said:

We’ve long said IAC is the ‘anti-conglomerate’ – we’re not empire builders. We’ve always separated out our businesses as they’ve grown in scale and maturity and soon Match Group, as the seventh spin-off, will join an impressive group of IAC progeny collectively worth $58 billion today.

Match Group CEO Mandy Ginsberg added:

We’ve grown up tremendously over the last 20 years as part of IAC, from an innovator in a nascent category to a global leader in a fast-growing market with millions of users all over the world. Match Group is in an incredibly strong position as we enter this transaction and we are ready for the next chapter of the company’s journey.

New Match will issue only a single class of common stock, where each share gets one vote. IAC’s Class B shares have ten times the voting power as its Class A shares. There is no indication that New IAC will have a different share structure.

New Match will retain IAC’s $1.7 billion in exchangeable notes and related hedging instruments, and IAC shareholders’ stake in New Match will be reduced at closing by the market value (currently $1.8 billion) of the notes and instruments.

Following the completion of the transaction, New Match is expected to have $300 million in cash, net debt of $3.5 billion (compared to pre-transaction net debt of $1 billion) and 276 million fully diluted shares outstanding.

IAC shares traded up about 1.3% in Thursday’s premarket session, at $224.00 in a 52-week range of $161.39 to $268.72. The consensus price target on the stock is $277.68.

Match Group shares traded at $73.60, up 3.3% from Wednesday’s closing price of $71.24. The stock’s 52-week range is $37.68 to $95.32, and the consensus price target is $81.94.

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