[opendtv] Re: News: Time Warner Offers $3 Billion to End AOL Hangover
- From: "John Willkie" <JohnWillkie@xxxxxxxxxxxxx>
- To: <opendtv@xxxxxxxxxxxxx>
- Date: Mon, 8 Aug 2005 10:19:20 -0700
ya mean they wrote down the value of the purchase of Time-Warner by AOL
because T-W was overvalued?
That's really funny, Craig, since if you look at the Time-Warner filings,
they say the EXACT opposite; that the write downs were because the value of
AOL plummeted. I also note that the AOL was dropped from "AOL Time Warner"
for similar reasons: it lost it's cachet. Very funny that the value of AOL
dropped to less than zero -- there are still dangling shareholder issues,
but you concentrate on Time-Warner being overvalued.
Steve Case said that he would do things that were impossible to do, at least
for anybody who knew the culture of Time-Warner and it's fiefdoms. Yet, he
did the merger. Now, you blame the seller? Seems to me that if there was a
problem that was identified in advance, that the responsibility falls with
the buyer.
John Willkie
----- Original Message -----
From: "Craig Birkmaier" <craig@xxxxxxxxx>
To: <opendtv@xxxxxxxxxxxxx>
Sent: Monday, August 08, 2005 5:02 AM
Subject: [opendtv] Re: News: Time Warner Offers $3 Billion to End AOL
Hangover
> At 5:46 PM -0700 8/6/05, John Willkie wrote:
> >so, that puts the net purchase price at about $16 billion, doesn't it? 6
> >billion purchase, 3 billion shareholder payout, and at least 6 billion in
> >write downs.
> >
> >And, they never were able to do a single thing that they suggested --
> >synergy -- but they did try a walled garden.
>
> The write downs would have happened anyway, as the book value of Time
> Warner was highly inflated. All of the other major congloms have
> taken similar write-downs related to over-valuation of assets and
> huge losses on contracts such as NFL rights.
>
> And the reason that they never did what they suggested was because
> the acquisition caused a civil war, and the TW folks sacrificed the
> company to prevent Steve Case from taking it in a new direction.
> Their strategy seems to have worked for now, but you can expect more
> write downs over the next decade as the broadcast side of the
> business tanks, and the cable side suffers from competition.
>
> Regards
> Craig
>
>
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