AOL merges with Time Warner, creating media giant

Online juggernaut America Online (AOL) announced Monday that it was acquiring media giant Time Warner for about $166 billion in stock. If this purchase goes through, it will be the biggest corporate merger of all time, as the resulting company will be worth over $350 billion. The new company will go by the name AOL Time Warner and focus on branded information, entertainment and communications services that will be available on several media platforms, including the Internet.

"This is an historic moment in which new media has truly come of age," said AOL CEO Steve Case, who will become Chairman of the Board of the new company. "We've always said that America Online's mission is to make the Internet as central to people's lives as the telephone and television, and even more valuable, and this is a once-in-a-lifetime opportunity to turn this promise into reality."

The combined company will own numerous familiar brands, including AOL, Time, CNN, CompuServe, Warner Bros., Netscape, Sports Illustrated, People, HBO, ICQ, AOL Instant Messenger, AOL MovieFone, TBS, TNT, Cartoon Network, Digital City, Warner Music Group, Spinner, Winamp, Fortune, AOL.COM, Entertainment Weekly, and Looney Tunes.

"This strategic combination with AOL accelerates the digital transformation of Time Warner by giving our creative and content businesses the widest possible canvas," says AOL Time Warner CEO Gerald Levin, formerly the CEO of Time Warner. "The digital revolution has already begun to create unprecedented and instantaneous access to every form of media and to unleash immense possibilities for economic growth, human understanding and creative expression. AOL Time Warner will lead this transformation, improving the lives of consumers worldwide."

In addition to news of the merger, AOL Time Warner also announced new corporate agreements that will expand the relationship between the two previously separate companies. Time Warner Web sites will be featured prominently on AOL.COM while AOL members will receive a number of benefits from Time Warner, such as exclusive deals, magazine subscription discounts, and more. Industry analysts hail the deal as the first blockbuster integration of Internet and traditional media

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