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American Morning

Minding Your Business: Steve Making Case for AOL Spin-Off

Aired May 27, 2003 - 07:45   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


HEIDI COLLINS, CNN ANCHOR: The man behind the marriage of AOL and Time Warner may be having second thoughts, but will he have the last word?
Andy Serwer has got more on this, "Minding Your Business" this morning.

ANDY SERWER, "FORTUNE" MAGAZINE: Good morning to you.

Yes, Steve Case, the founder of AOL, former chairman, still board member, apparently talking about spinning off AOL, which is hugely ironic because he was the architect of the merger between AOL and Time Warner. And AOL was supposed to be the centerpiece of the merger that was going to draw everything together in "digital convergence." Do you remember that phrase?

LEON HARRIS, CNN ANCHOR: Yes.

SERWER: "Digital convergence."

COLLINS: Yes.

SERWER: You don't hear much about it today.

HARRIS: But outsiders have been suggesting this spin-off for a while, haven't they?

SERWER: That's right.

COLLINS: Yes.

SERWER: They have been, and Case has talked about it a little bit, too, but the "Times" is reporting that apparently he is getting serious. The question is: Would the rest of the board get serious about him doing it? Not clear at all.

Also, the "Times" reporting that there is a strategy committee that he used to head. They have quietly disbanded that. So, he has sort have been marginalized at the company, no question about it.

You know, it's interesting, a lot of people have suggested, Heidi, that if AOL was to leave the company that the company's stock would go up. And, in fact...

COLLINS: That's my next question.

SERWER: Yes, the stock has gone up a lot this year already. You can see here it's up 46 percent since February.

COLLINS: Wow!

SERWER: Let's say that again: 46 percent since February, some of us here on the floor as shareholders. That's while the Dow is up 9 percent.

But my take on this is if this is the guy who wanted to put the companies together, and it did badly, and now he wants to take it apart, I'm against it. See? Right? I mean, he wants to take this thing -- maybe it's a bad idea, right?

COLLINS: You're not trusting him so much, huh?

SERWER: No, maybe not.

COLLINS: All right, what about the stock market? As we said, it's been gaining ground lately.

SERWER: It has. And the futures are down a little bit this morning.

One final word about Time Warner, I can't resist this. The stock is up. Now, Ted Turner, you remember, he sold...

COLLINS: Yes.

SERWER: ... a bunch of stock about two weeks ago, three weeks ago.

HARRIS: He's been selling it off pretty regularly lately.

SERWER: Right. He sold about 60 million shares at 13 buck. It's now at 14.70. So, he left almost $100 million on the table so far. Well, you know, we'll see.

COLLINS: Too bad for him.

SERWER: Right, yes.

COLLINS: OK, thanks so much, Andy Serwer...

SERWER: OK.

COLLINS: ... "Minding Your Business."

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com.







Aired May 27, 2003 - 07:45   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
HEIDI COLLINS, CNN ANCHOR: The man behind the marriage of AOL and Time Warner may be having second thoughts, but will he have the last word?
Andy Serwer has got more on this, "Minding Your Business" this morning.

ANDY SERWER, "FORTUNE" MAGAZINE: Good morning to you.

Yes, Steve Case, the founder of AOL, former chairman, still board member, apparently talking about spinning off AOL, which is hugely ironic because he was the architect of the merger between AOL and Time Warner. And AOL was supposed to be the centerpiece of the merger that was going to draw everything together in "digital convergence." Do you remember that phrase?

LEON HARRIS, CNN ANCHOR: Yes.

SERWER: "Digital convergence."

COLLINS: Yes.

SERWER: You don't hear much about it today.

HARRIS: But outsiders have been suggesting this spin-off for a while, haven't they?

SERWER: That's right.

COLLINS: Yes.

SERWER: They have been, and Case has talked about it a little bit, too, but the "Times" is reporting that apparently he is getting serious. The question is: Would the rest of the board get serious about him doing it? Not clear at all.

Also, the "Times" reporting that there is a strategy committee that he used to head. They have quietly disbanded that. So, he has sort have been marginalized at the company, no question about it.

You know, it's interesting, a lot of people have suggested, Heidi, that if AOL was to leave the company that the company's stock would go up. And, in fact...

COLLINS: That's my next question.

SERWER: Yes, the stock has gone up a lot this year already. You can see here it's up 46 percent since February.

COLLINS: Wow!

SERWER: Let's say that again: 46 percent since February, some of us here on the floor as shareholders. That's while the Dow is up 9 percent.

But my take on this is if this is the guy who wanted to put the companies together, and it did badly, and now he wants to take it apart, I'm against it. See? Right? I mean, he wants to take this thing -- maybe it's a bad idea, right?

COLLINS: You're not trusting him so much, huh?

SERWER: No, maybe not.

COLLINS: All right, what about the stock market? As we said, it's been gaining ground lately.

SERWER: It has. And the futures are down a little bit this morning.

One final word about Time Warner, I can't resist this. The stock is up. Now, Ted Turner, you remember, he sold...

COLLINS: Yes.

SERWER: ... a bunch of stock about two weeks ago, three weeks ago.

HARRIS: He's been selling it off pretty regularly lately.

SERWER: Right. He sold about 60 million shares at 13 buck. It's now at 14.70. So, he left almost $100 million on the table so far. Well, you know, we'll see.

COLLINS: Too bad for him.

SERWER: Right, yes.

COLLINS: OK, thanks so much, Andy Serwer...

SERWER: OK.

COLLINS: ... "Minding Your Business."

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com.