Posted 12:10 a.m. MST, March 8, 2007
PALO ALTO, Calif. - Google Inc. (GOOG) formerly delivered a hostile takeover bid to Time Warner Inc. (TWX) today. The bid of $50 billion dollars was received by Richard D. Parsons, CEO of Time Warner. It is unknown at this time whether Parsons and his committee will accept the bid or not. The FCC is in the process of doing some preliminary investigations in order to stop a monopoly from forming if in fact Time Warner decides to accept the bid.
Parsons reported that they had not yet made the decision on whether or not to sell the company, but they are taking this bid very seriously. The board should be sitting down soon to calculate and see what amount they think Time Warner is worth. Time Warner has 30 days to decide what its decision is, and Parsons said that they would have an answer by then.
Google has been looking at expanding their company for some time. They recently purchased You Tube for $1.65 billion in stock. The major conglomerates are expanding and the race to buy major companies has begun. Eric Schmidt, CEO and Chairman of Google said that “to merge that user base, I think would be beneficial to both the producer and consumer.”
Schmidt mentioned that the bid was rounded up and it was placed for more money than they thought Time Warner was actually worth. Google apparently offered Time Warner $35 billion in stock, $10 billion in cash and $5 billion in debt. Schmidt said, “ I think that this is an opportune time to take advantage of the two companies … I think that it is long overdue.”
It is rumored that Yahoo! Inc. (YHOO) and Microsoft Inc. (MSFT) are also in the expanding and merging business. Microsoft was apparently talking to Time Warner about purchasing AOL. Chair of the Board at Microsoft, William (Bill) Gates said that “it is more streamlined to have everything under one roof.” It is unknown as to whether the FCC will actually step in to prevent a monopoly, or whether they are just to busy to care.
4 comments:
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