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What will this mean for Net stocks?
Filed at 4:30 a.m. ET
By Reuters
NEW YORK (Reuters) - Media giant Time Warner Inc. (TWX.N) and leading online-service provider America Online Inc. (AOL.N) are expected to announce a stock-for-stock merger early Monday, Dow Jones Newswires reported on Monday.
Details of the deal weren't immediately available, Dow Jones reported, citing unnamed people familiar with the situation.
America Online Chairman and Chief Executive Steve Case, is expected to be named chairman of merged company, while Time Warner's Chairman and Chief Executive Gerald Levin will be chief executive, Dow Jones said.
People briefed on the transaction told Dow Jones that AOL shareholders are likely to hold a majority stake in the merged company of just over 50 percent.
Dulles, Va.-based AOL (AOL) currently has a market capitalization of about $164 billion, about twice the $83 billion of New York-based Time Warner, but the deal's terms are unlikely to value AOL as highly, the people told Dow Jones.
By uniting a major media conglomerate with a leading Internet company, the transaction is likely to have major repercussions on both industries.
It comes at a time when many big media companies are struggling to figure out how to harness the power of the Internet, and when Internet companies are increasingly looking to put entertainment and other content on their Web sites to attract more customers, Dow Jones said.
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