/
05.29.2009 12:00AM
Time Warner Plans to Spin AOL

NEW YORK: Time Warner is looking into spinning off AOL. Company chief Jeff Bewkes said today that a spin-out appears to be the best option for divesting the Internet unit, according to Reuters. A spin would divide Time Warner’s AOL stock among its own shareholders on a pro rata basis.

The plan to shed AOL comes just a month or so after the cable business was similarly spun out so Time Warner (NYSE: TWX) could focus on content. The company owns the Turner channels--CNN, TNT, TBS, Cartoon Network, etc.--as well as HBO, where Bewkes cut his teeth. It also has Warner Bros. studios and Time, Inc. publishing.

Spinning off AOL would end a relationship structured nine years ago by former Time Warner Chairman Jerry Levin, a veteran button-down TV executive who famously donned a polo shirt to announce the merger with AOL founder Steve Case. AOL was the quintessential Internet powerhouse at the time, dominating email use and dial-up Web access. As if by an occult hand, free browser-based service and ISP competition started to flourish. Levin’s vision of a massive, synergistic content-distribution system spruce goosed. Around $200 billion in shareholder value disappeared within a few years of the merger.

TWX shares got a small boost from the news, rising briefly yesterday from $22.80 to $23.74, before settling down today at around $23.25. In late 1999, just before TWX merged with AOL, shares briefly peaked at more than $270.-- Deborah D. McAdams 



Comments
Post New Comment
If you are already a member, or would like to receive email alerts as new comments are
made, please login or register.

Enter the code shown above:

(Note: If you cannot read the numbers in the above
image, reload the page to generate a new one.)

1.
Posted by: Deborah McAdams
Sat, 05-30-2009 - 1:40PM Report Comment
You used "the occult hand" in an unbylined piece? Really. The Order does not approve.




Wednesday 9:02AM
Analysts: TV Regs 'Not as Dire as We Thought'
We feel the negatives are known and are a lot more comfortable recommending the space.


 
Featured Articles
Discover TV Technology