Time Warner has revealed the details of the AOL spin-off confirming that AOL and its 7,000 employees will split from Time Warner on December 9.
The split marks the end of a decade long, costly experiment that never quite found its point of synergy. Time Warner acquired AOL back in January 2001 for $164 billion.
On December 9, shareholders will receive one share of AOL common stock for every 11 shares of Time Warner common stock they hold. The AOL spin-off has been structured to qualify as a tax-free dividend to Time Warner stockholders for US federal income tax purposes.
Shares of Time Warner common stock will continue to trade on the New York Stock Exchange under the symbol “TWX” . From December 10, AOL common stock will begin trading under the symbol “AOL”.
In a SEC filing on Thursday, Time Warner said AOL will log up to $200 million in additional restructuring charges from the date of the spin-off through the first half of 2010. The company also said they might also be for closing down or making cuts to some of its operations outside the US which includes cutting 100 positions.
AOL recorded $10.2 million in charges related to job cuts and $82.9 million related to facility closures during Q3.
In January, AOL said it would cut up to 700 jobs, or about 10% of its work force, in an effort to lower costs. It currently has about 6,900 employees.