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Liberty Media Buying IDT Ent. to Propel Starz Ent. Group Programming

Liberty Media Corp. is buying IDT Ent. from parent company IDT Corp. it was announced today, May 16, 2006. Liberty will give up its holdings in IDT Corp. to add this diversified production/distribution group of companies to its holdings, which includes Starz Ent. Group that will have the capability to create a wide array of CG-animated and live-action programming for domestic and international distribution in all major channels, including broadcast syndication, premium television, theatrical and home video/DVD.

Liberty Medias sells its interests in IDT Corp. for $186 million in cash and the assumption of existing indebtedness.

Englewood, Colorado-based Liberty Media owns a broad range of electronic retailing, media, communications and entertainment businesses and investments. It owns or has interests in some of the world's most recognized and respected brands and companies, including QVC, Encore, Starz, IAC/InterActiveCorp, Expedia and News Corp.

Newark, New Jersey-based IDT Ent. (www.idtentertainment.com) is a vertically integrated entertainment concern that owns Film Roman (now DPS Film Roman), DKP Effects, Manga Ent., DVD/home video distributor Anchor Bay Ent. Group, Australian-based independent distributor Imagine Ent. a controlling interest in Mainframe Ent. Inc. plus a minority equity interest in Vanguard Animation Llc. and Stan Lees POW! Ent.

This purchase comes on the heels of Liberty Media Corp. announcement (May 12) to sell Time Warner Inc. its half of Courtroom Television Network Llc., the owner of Court TV, for $735 million. Time Warner now owns Court TV in its entirety. Court TV will operate as part of Turner Broadcasting System Inc., within its entertainment division, under the direction of entertainment group president, Mark Lazarus.

Gregory B. Maffei, ceo of Liberty Media, said, This transaction furthers our strategy of converting investments into strategic operating businesses that have synergies with our current companies. IDT Ent. and Starz is a great combination. We have appreciated our long friendship with IDT and look forward to the next phase of our partnership.

John Malone has been a great mentor and friend," said Howard Jonas, IDTs chairman. "I anticipate great things from our continuing business relationship,

This is a union of two companies that have complementary strengths and share the entrepreneurial spirit essential for success in the rapidly changing world of video production and distribution, said SEG president/ceo Robert B. Clasen. With the addition of the dynamic, creative team at IDT Ent., our company will be positioned to capitalize fully on the opportunities afforded by the new era of content.

In just three years, we have built IDT Ent. into a strong, vertically-integrated entertainment company, said Jim Courter, IDTs ceo. We are capitalizing on the value we have created in this business in order to allow us to generate an attractive return for our shareholders. We believe that Liberty Medias Starz Ent. Group is the right company to realize IDT Ent.s full potential.

Expected to close within the next three months, Liberty Media will pay to IDT $186 million in cash, subject to certain adjustments, and all of Liberty Medias equity interests in IDT and its subsidiaries, including approximately 17.2 million shares of IDTs Class B common stock and Liberty Medias approximate 5% interest in IDT Telecom. Liberty will also assume IDT Ent.s existing indebtedness. IDT may receive additional consideration from Liberty based upon the appreciation in value of IDT Ent. over the five-year period following closing.

On closing, IDT Ent. and Starz will enter into a five-year programming output agreement for the broadcast on Starzs premium channels certain IDT Ent.s proprietary CG-animated theatrical releases and live-action programming. The transaction is subject to certain customary conditions and contingencies, including the finalization and execution of definitive documentation and the receipt of regulatory approvals.

Starz Ent. Group (SEG, www.starz.com) is a premium movie service provider operating in the U.S. SEG offers 16 movie channels, including the flagship Starz and Encore brands with approximately 14.6 million and 26.4 million subscribers respectively. Starz Ent. Group airs more than 1,000 movies per month across its pay TV channels and offers advanced services, including Starz HDTV, Starz On Demand and Vongo(SM). Starz Ent. Group is a wholly owned subsidiary of Liberty Media Corp. IDT Corp., through its IDT Telecom subsidiary, is a facilities-based, multinational carrier that provides a broad range of telecommunications services to retail and wholesale customers worldwide. IDT Telecom, by means of its own international telecommunications backbone and fiber optic network infrastructure, provides its customers with integrated and competitively priced international and domestic long distance and domestic all-distance telephony and prepaid calling cards. IDT Ent. is the IDT subsidiary that is focused on developing, acquiring, producing and distributing computer-generated and traditionally animated productions and other productions for the film, broadcast and direct-to-consumer markets.

IDT Capital is the IDT division principally responsible for IDTs initiatives in radio broadcasting, brochure distribution and new technologies. Net2Phone, Inc., a subsidiary of IDT Corp., is a provider of high-quality global retail Voice over IP services and offers a fully outsourced cable telephony service to cable operators allowing cable operators to provide residential phone service to their subscribers.