Time Warner (TWX) says in its quarterly report to the SEC it has “notified Google of its intention” to buy back the 5% stake in AOL that Google (GOOG) acquired in April 2006. This as Time Warner plans to spin off AOL as a separate company under new CEO Tim Armstrong, an ex-Googler.
But as paidContent’s Staci Kramer notes, Time Warner management said on this morning’s earnings call that the stake repurchase is not necessarily a done deal:
Time Warner CFO John Martin mentioned the move during today’s earnings call, describing the response as “moving down a path that could result” in acquiring the stake. he said the company is still in discussions with Google about various possibilities. He also said—in an almost offhand way—that “it’s not a material amount of money one way or the other, not a huge material event.”
Here’s the passage from Time Warner’s 10-Q about the Google stake:
“In late January 2009, Google exercised its right to request that AOL register Google’s 5% equity interest for sale in an initial public offering. Time Warner has the right, but not the obligation, to purchase Google’s equity interest for cash or shares of Time Warner common stock based on the appraised fair market value of the equity interest in lieu of conducting an initial public offering. The Company is in discussions with Google and has notified Google of its intention to purchase the 5% equity interest.”
And here’s the passage about the spinoff:
“Although the Company’s Board of Directors has not made any decision, the Company currently anticipates that it would initiate a process to spin off one or more parts of the businesses of AOL to Time Warner’s stockholders, in one or a series of transactions. Based on the results of the Company’s review, future market conditions or the availability of more favourable strategic opportunities that may arise before a transaction is completed, the Company may decide to pursue an alternative other than a spin-off with respect to either or both of AOL’s businesses.”
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