May 28, 2009--With news that Time Warner Inc. may be able to spin off AOL LLC, Richard Morgan, assistant managing editor of The Deal, went on American Public Media's Marketplace radio program to discuss why the merger failed.
Morgan commented that the high price of AOL was wrong from the start. "Back then a lot of people were drinking the Kool-Aid about the 'new economy,'" he said. "When they announced that they were going to create the deal of the century, they put the value at $166 billion. Today, the market cap of Time Warner, which contains AOL, is only $28 billion. So that's a loss that's greater than 80 percent."
To hear Richard Morgan comments made on air, visit http://marketplace.publicradio.org/display/web/2009/05/28/pm_time_warner/