Original URL: http://www.theregister.co.uk/2009/07/28/timewarner_aol_google/
Time Warner swallows Google's AOL stake
Spin off one step nearer
Posted in Financial News, 28th July 2009 11:00 GMT
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Time Warner has bought back the five per cent stake in AOL which Google bought for $1bn back in 2003 - only having to cough up $283m for the stake.
Google wrote the investment down by $726m [1] in February.
The buyback is a necessary step in Time Warner's long-stated ambition [2] to spin AOL off as an independent company.
It hired Tim Armstrong [3] to head up the new and improved AOL.
The merger of AOL and Time Warner cost somewhere in the region of $160bn at the height of dot-com lunacy in 2000.
AOL started out as an internet service provider distributing millions of promotional CDs. It sold its UK dial-up business to CarphoneWarehouse and is now trying to redefine itself as a content provider and ad sales organisation.
AOL's revenues fell 23 per cent to $867m in the quarter ended March 31 2009. This was blamed on a 27 per cent fall in subscription revenues and a 20 per cent fall in ad revenues. ®