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Time Warner to Spin Off AOL?

Posted by timothy on from the concerted-effort dept.

image77 writes "The Washington Post is reporting that Time Warner is considering spinning AOL into a separate company via an IPO. You might recall that AOL bought Time Warner for over $100 Billion in 2001, and then went on to lose almost that much in 2002."

1 of 164 comments (clear)

  1. Technically.... by fm6 · · Score: 5, Informative
    AOL did indeed buy Time-Warner, but it was really a merger. At the time, nobody realized (that they'll admit) how inflated AOL stock was, so it seemed to make sense to structure the merger as acquisition. That allowed them to pay for the merger simply by giving AOL stock to Time-Warner shareholders and renaming AOL as "AOL-Time-Warner".

    "AOL bought Time-Warner", while technically correct, is pretty misleading, since Time-Warner management initially had an equal role in the combined company. And "equal" soon changed to "dominant" as it become more and the AOL part would never lived up to initial expectations, and shareholders granted more and more authority to the Time-Warner part.