IP: WHO THOUGHT UP THE AOL TIME WARNER MERGER?

[Dave Farber <dave () farber net>]

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From:
Date: Mon, 1 Apr 2002 12:30:01 -0500
To: dave () farber net
Subject: WHO THOUGHT UP THE AOL TIME WARNER MERGER?

WHO THOUGHT UP THE AOL TIME WARNER MERGER?
Once hyped as the greatest idea since the invention of sliced bread, the
merger two years ago of "new economy" company online company AOL and "old
economy" publishing empire Time Warner now seems as stale as yesterday's
croissants. In January 2000 the two companies together were worth more than
$300 billion, but now they are down to one-third that amount ($105 billion,
and a further descent is expected). What was the idea? To get marketing
"synergy" that would make the new company more valuable than the sum of its
two parts. But the synergies failed to materialize, and now the company
sometimes seems to be contemplating its own navel (AOL Time Warner is AOL
Time Warner's biggest advertiser). Industry analyst Rick Berry in Atlanta
thinks that the company's stock is still a "sell," calling the merger "an
absolute mistake," and says: "The only reason it went through is that this
was during the silly times in the market. Otherwise, there was not a chance
in hell." (Washington Post 1 Apr 2002)
http://www.washingtonpost.com/wp-dyn/articles/A43992-2002Mar31.html



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