• The Wall Street Journal, Wednesday, September 3, 2008 10:30 AM

As The Wall Street Journal's Martin Peers says: "It's early days, but so far the (IAC/InterActiveCorp) split-up hasn't exactly set the world on fire." To be fair, it's still very early days. IAC broke apart on Aug. 20, splitting into five units: Ticketmaster, Tree.com, HSN, Interval Leisure, and IAC. Before the split, IAC shares were trading at $17.60; yesterday, the combined value-per-share of the five new entities was only slightly higher, at $18.53.

This is disappointing, particularly for IAC, which was supposed to receive the biggest bounce after shedding what many felt was dead weight, particularly in the form of Tree.com and Ticketmaster. The Journal blames the lack of bounce on skepticism about Barry Diller, who remained IAC's CEO after the split. Why, because on the one hand, the stock appears cheap, trading at a multiple of 5.5 times Ebitda. Google, for example, trades at a multiple of 11.6, and Amazon, 18.7. On the other hand, Sanford Bernstein estimates that IAC revenues will only increase 11.5% in 2009.

Diller, meanwhile, can be blamed for throwing "hundreds of millions of dollars at a series of forgettable acquisitions," from Precision Response Corp. to Styleclick, Cornerstone, and most perhaps most painful, Lending Tree. Diller bought the latter for $700 million in 2003; its standalone market value is currently about $75 million. As Peers says, "The best chance for IAC shareholders to realize the true value of the assets is for Mr. Diller to take the next step and sell off the remaining pieces of his empire."

Read the whole story at The Wall Street Journal »