New York: Media conglomerate Time Warner has
purchased back Google's five percent stake in ailing internet
firm AOL for USD 283 million, a price much lower than what the
search engine major paid for buying the shareholding in 2006.
Three years ago, Google snapped up the five per cent
stake in AOL for USD 1 billion.
"On July 8, 2009, Time Warner repurchased Google's five
per cent interest in us for USD 283 million, which included a
payment in respect of Google's pro rata share of cash
distributions to Time Warner by AOL attributable to the
period of Google's investment in us," AOL said in a regulatory
filing yesterday.
Time Warner has bought back the stake as part of its
efforts to spin off AOL into a separate entity from itself.
Following the buy back of the five per cent shareholding,
AOL has become a 100 per cent subsidiary of Time Warner.
Going by the filing, the alliance with Google has been
beneficial for AOL and has generated good revenues over a
period of time. The revenues associated with the Google
relationship stood at USD 677.9 million for the year ended
December 31, 2008.
During the same period, AOL's total revenues touched USD
4.17 billion.
In May this year, Time Warner unveiled plans for complete
legal and structural separation of AOL from the group. Once
the spin off is complete, AOL would be an independent,
publicly-traded company.
Bureau Report
First Published: Tuesday, July 28, 2009, 21:06