Billion-dollar download: Google buys 5% of AOL

Billion-dollar download: Google buys 5% of AOL

Time Warner officially confirmed Tuesday what everyone in the entertainment industry probably already knew: It will sell 5% of America Online to Google for $1 billion. The decision defies the unsolicited advice of shareholder Carl Icahn, who in his noisy proxy battle with TW directors warned against such a deal. Similarly, AOL billionaire founder Steve Case, who engineered AOL's takeover of TW in what many on Wall Street now consider one of the most ill-advised mergers in corporate history, also suggested an alternative for AOL. Case, who recently resigned as a TW director, said he would prefer a complete spinoff of AOL so that it might focus on, among other things, becoming a leading provider of Internet-voice services to compete with offerings from telephone companies. On Wednesday, Time Warner shares lost 16 cents, closing at $17.58. Google also closed $3.41 lower at $426.33.