Former Chairman of the FCC Michael Powell (son of General Colin Powell) and investment banker William Hambrecht plans to join the AOL board of directors once the company spins off independently. Time Warner Inc. (NYSE:TWX) currently owns AOL as part of a $164 billion merger that took place in 2000.
The nine directors that will be part of AOL after the spin off also includes CEO Tim Armstrong. Michael Powell currently works for Providence Equity Partners LLC. Providence Equity is currently one of the major investors in Hulu too.
Hambrecht founded WR Hambrect + Co., an investment banking company that works with many Internet companies. Hambrecht has been working at the investment bank since about 1998.
Frederic Reynolds (retired CFO of CBS), Richard Dalzell (former Amazon.com exec), Karen Dykstra (Plainfield Asset Management partner), Patricia Mitchell (President/CEO of the Paley Center for Media), James Stengel (management consultant), and James Wiatt (former CEO of William Morris Agency) will also be joining AOL.
Earlier today CNN.com invited people to check out their new website at the One Time Warner Center office in New York City. At the same meeting CNN President Jim Walton announced that the news company increased profits year over year. CNN receives 38 million visitors per month and has about 100 million monthly video views. In the websites entire history, it received 121 billion page views. The new CNN.com will launch on Monday. The Cable News Network is owned by Time Warner.
AOL has a new Chief Financial Officer. His name is Artie Minson and he was a previous EVP and Deputy CFO at Time Warner. Before Time Warner, Minson worked at AOL in a Corporate Finance and Development position.
“Artie’s strong financial acumen, operating experience, and deep understanding of our company and the Internet and content industries make him a perfect fit for AOL,” stated AOL CEO Tim Armstrong. “He’s also a public company veteran who helped handle Time Warner Cable’s transition to a public company. Artie will hit the ground running and be a tremendous asset to AOL as we focus on driving growth, value and innovation.”
Minson has an Accounting B.S. degree from Georgetown University and an MBA from Columbia Business School.
AOL has filed a lawsuit against Advertise.com. Advertise.com used to be known as ABCsearch.com. ABCsearch bought Advertise.com for an undisclosed price earlier this past year.
The lawsuit states the following:
“…Advertise.com recently commenced use of the virtually identical and confusingly similar designation Advertise.com and design in connection with the same and complimentary services as those offered by Plaintiffs under their federally-registered Advertising.com name and marks and their Ad.com name and marks.”
AOL believes that Advertise.com would cause consumer confusion for those that are interesting in Ad.com or Advertising.com. AOL does not own the domain name Ad.com but had previously referred to Advertising.com as Ad.com.
Yahoo!’s VP of West Coast Sales David Dickman has decided to leave the company and join Time Warner. Dickman will be working in digital sales at Time Warner. The reason why Dickman left Yahoo! was because he was not happy with organization changes happening at Yahoo!
Dickman worked at Yahoo! for 3 years and was in charge for the premium display advertising sales. Before Dickman stepped down from his position, he was reporting to Mitch Spolan.
Si TV is a Latino cable channel with a complementary online network website. According to an SEC filing, Si TV has raised $8.75 million in funding. Si TV plans to raise an additional $6 million in funding. Si TV previously raised $60 million in funding from EchoStar, Time Warner, Columbia Capital, and Rho Ventures around 2004.
Si TV has about 19 million cable subscribers since they launched. Si TV has syndication deals with Hearst and Verizon. Si TV has dropped in web traffic recently from 500,000 uniques last year to about 150,000 uniques per month. The new round of funding may be used for a website redesign or the acquisition of other online properties.
Si TV is in the midst of launching a new season of TV series Model Latina. Si TV also issued a statement about the appointment of Supreme Court Justice Sonia Sotomayor.
“Latinos that their dreams can become reality through education, hard work and a strong family. At Si TV, a network dedicated to providing positive entertainment for the American Latino community, we take enormous pride in Justice Sotomayor’s landmark appointment. We congratulate her and wish her well in her new role on our nation’s highest court,” stated Si TV CEO Michael Schwimmer.
In December 20, 2005, Google announced a strategic alliance with AOL. The financial agreement was that Google would invest $1 billion in AOL for 5% ownership. According to the press release sent out at the time, the strategic agreement would go as follows:
* Creating an AOL Marketplace through white labeling of Google’s advertising technology – enabling AOL to sell search advertising directly to advertisers on AOL-owned properties;
* Expanding display advertising throughout the Google network;
* Making AOL content more accessible to Google Web crawlers;
* Collaborating in video search and showcasing AOL’s premium video service within Google Video;
* Enabling Google Talk and AIM instant messaging users to communicate with each other, provided certain conditions are met; and
* Providing AOL marketing credits for its Internet properties.
Due to Time Warner’s desire to spin off AOL as its own separate entity and several other complications, Google decided to cancel the deal and cash their losses.
Google took a major hit financially when cashing out on their 5% AOL ownership. Even though they invested $1 billion, they sold the equity for $283 million back to Time Warner. The transaction took place on July 8th and is based on pegging AOL’s valuation at $5.7 billion.
As of right now it is unclear what changes will be made strategically between Google and AOL after the Time Warner subsidiary spins off as an independent entity. I doubt much will change.
AOL has bought out a local news website called Patch.com. Tim Armstrong invested seed capital in Patch.com back in 2007. As part of the deal, Armstrong will not profit from the seed investment he put in. However, he will receive his seed capital back through AOL shares once the company separates from Time Warner.
Armstrong’s seed capital was made through his private investment company Polar Capital Group. Another acquisition that AOL announced is Going.com. The price of both properties were not disclosed.
The full press release is available after the jump.
Turner Classic Movies turned 15 years old and they are celebrating by launching a social network. The social network is called the TCM Classic Film Union and the URL is tcm.com/fan. The social network has features such as profiles, movie fans, actor and actress fans, and rare photos and video clips centered around Turner Classic Movies.
There are over a million actors, directors, producers, etc. in the database to become fans of. The TCM social network also has thousands of movies that people can become fans of. Turner Classic Movies is a part of Turner Broadcasting System inc. and a subsidiary of Time Warner.
Some of the stars include Marlon Brando, John Payne, Bette Davis, John Wayne, Bing Crosby, Audrey Hepburn, Judy Garland, Humphrey Bogart, etc. The classic movies in the TCM social network database include Ada, Casablanca, The Wizard of Oz, North by Northwest, and Gone With The Wind.
Last night the Board of Directors at Time Warner agreed to spin off AOL as its own entity once again. AOL will become an independent and public company.
“We believe that a separation will be the best outcome for both Time Warner and AOL. The separation will be another critical step in the reshaping of Time Warner that we started at the beginning of last year, enabling us to focus to an even greater degree on our core content businesses. The separation will also provide both companies with greater operational and strategic flexibility. We believe AOL will then have a better opportunity to achieve its full potential as a leading independent Internet company,” stated Time Warner Chairman and CEO Jeff Bewkes
AOL currently reaches about 107 million unique visitors per month on all of their services. AOL will continue to operate as an ISP too.
As of right now, Time Warner owns 95% of AOL and Google owns 5%. After the spin off is complete, Time Warner will buy back the 5% from Google in the third quarter of 2009. Time Warner shareholders will end up owning 100% of outstanding interests in AOL. The transaction will be tax-free to Time Warner shareholders and is contingent upon review of the SEC.
In January 2000, AOL acquired Time Warner for $164 billion. After the merger was complete, AOL began to see their ISP division profits plummet, causing them to report a loss of $99 billion in 2002. Steve Case was removed as Chairman and was replaced by Richard Parsons. “AOL” was dropped from the company name “AOL Time Warner.”
AOL has hired Jeff Levick, a former executive at Google. Levick will become the president of global advertising and strategy, who will directly report to new AOL CEO Tim Armstrong. Armstrong himself was Google’s former North America ad sales head a couple of months ago.
“This is a perfect time to join AOL and I firmly believe that AOL’s best days are ahead of it,” stated Levick. “The company has one of the largest and most engaged audiences on the Web, some of the best advertising technology in the business, and a powerful third-party network. There is great opportunity here for us to capture.”
Greg Coleman was replaced by Levick. The reason why he was let go is unknown. Coleman joined AOL in February 2009. That he was at AOL for less than 3 months! Coleman was an advertising head at Yahoo! before AOL.
Time Warner Inc. (NYSE:TWX) stated today that they have named Google Inc. (NASDAQ:GOOG) SVP and President of American Operations as the new Chairman and CEO of AOL. AOL’s current Chairman and CEO Randy Falco will be leaving along with President and COO Ron Grant.
“Tim is the right executive to move AOL into the next phase of its evolution. At Google, Armstrong helped build one of the most successful media teams in the history of the Internet — helping to make Google the most popular online search advertising platform in the world for direct and brand marketers. He’s an advertising pioneer with a stellar reputation and proven track record. We are privileged to have him preside over AOL as its audience and programming businesses continue to grow and its advertising platform expands globally. He’ll also be helpful in helping Time Warner determine the optimal structure for AOL,” stated Time Warner Chairman and CEO Jeff Bewkes.
“Both companies will be better positioned to compete, with capital structures more suited to their respective needs,” stated Time Warner CEO Jeffrey Bewkes.
Time Warner’s spin-off of Time Warner Cable should be completed by next month. This will make Time Warner purely a media company. Time Warner initiated the separation possibility of separating its telecommunications cable operations from their content units about four years ago.
This will enable Time Warner to focus on their major media brands such as CNN, HBO, Time magazine, Sports Illustrated, and the Warner Bros. movie studio.
The terms for separating the companies were agreed upon on May 20, 2008. Since then, it was subject to the government regulation process. Within the last few weeks, the separation was approved by the FCC and the IRS. The separation should be complete by March 12.
Eidos announced that they will accept a $120 million takeover deal from Square Enix to be acquired. Square Enix is best known for their Final Fantasy series of games. After the last Lara Croft game did not meet expectations, it was forced to renegotiate bank loans. Eidos is based in Britan and Square Enix is based in Japan.
Two of Eidos’ major stakeholders Insight Investment Management and Cazenove Capital management agreed to the deal. Time Warner also owns a 20% stake in Eidos. Time Warner must accept the deal or make a counter-bid in order for the deal to go through. The $120 million deal amounts to about 32 pence a share. This is more than twice what Eidos’ current shares are worth.
Microsoft Corporation (NASDAQ:MSFT) Steve Ballmer and Yahoo! Inc. (NASDAQ:YHOO) Chairman Roy Bostock were spotted meeting at the Time Warner Center yesterday. This took place two days after Yahoo! named a new CEO, Carol Bartz.
According to a tipster at Valleywag:
“On my way down the elevator, I was stopped on the 5th floor and in walk Roy Bostock and Steve Ballmer. Kind hellos were exchanged. As we entered the lobby they both walked out and seemingly proceeded to lunch together.”
Valleywag came up with several plausible conclusions out of the meeting here. The first is that Microsoft is still interested in buying Yahoo!’s search business, but Bartz said that she wasn’t interested in getting to that right away. Another possible reason is that Ballmer said he was ready to come back to the negotiation table when Yahoo! got a new CEO and both executives may have been in New York around the same time.
Given that they were meeting in the Time Warner building, my guess is that executives there may have wanted to arrange a deal between AOL, Yahoo!, and Microsoft. Time Warner clearly wants to unload AOL somehow and Microsoft has a big enough wallet to take possession of AOL. You never know what could happen when you put these three outfits in the same room. More details as this story unfolds.
