The 90s Finally End

CNBC reports:

Time Warner to Spin Off AOL
Time Warner says its board has approved plans to spin off AOL, the company’s lagging Internet unit.
The New York company, which owns 95 percent of AOL, said Thursday it will buy out Google’s 5 percent stake during the third quarter and spin the unit off to Time Warner shareholders.
The long-anticipated move is expected to be completed around the end of the year.
AOL and Time Warner combined in 2001 in a deal they said would produce a powerful marriage of content and the Internet. But it produced big losses instead.
In a statement, Time Warner Chief Executive Jeff Bewkes said, “We believe AOL will then have a better opportunity to achieve its full potential as a leading independent Internet company.”
Time Warner shares rose almost 3 percent in premarket trading.

For a good laugh, here’s the CNN story announcing the merger more than nine years ago.

In a stunning development, America Online Inc. announced plans to acquire Time Warner Inc. for roughly $182 billion in stock and debt Monday, creating a digital media powerhouse with the potential to reach every American in one form or another.
With dominating positions in the music, publishing, news, entertainment, cable and Internet industries, the combined company, called AOL Time Warner, will boast unrivaled assets among other media and online companies.
The merger, the largest deal in history, combines the nation’s top internet service provider with the world’s top media conglomerate. The deal also validates the Internet’s role as a leader in the new world economy, while redefining what the next generation of digital-based leaders will look like.
“Together, they represent an unprecedented powerhouse,” said Scott Ehrens, a media analyst with Bear Stearns. “If their mantra is content, this alliance is unbeatable. Now they have this great platform they can cross-fertilize with content and redistribute.”

Posted by Eddy Elfenbein on May 28th, 2009 at 10:03 am

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.