Icahn Hires Lazard To Look Over Time Warner

    November 29, 2005

Carl Icahn’s Icahn Group announced they hired the Lazard financial advisory firm to review Time Warner and to analyze alternatives to “maximize the value” of Time Warner stock. This is just the latest shot in an ongoing battle between Icahn and the Time Warner board of directors.

AOL’s parent company has had a rocky road for quite some time. Their stock values weren’t so great so they merged with hot company AOL. The relationship fizzled as did stock prices. The board at Time Warner has struggled to bring the stock value up for sometime.

Enter Carl Icahn, a notorious corporate raider with a penchant for cracking heads. He worked over other companies including Blockbuster but hadn’t tackled anything quite so big as Time Warner. He’s given them grief over how they’ve handled the AOL side of things, with competing services and a host of other problems he sees at the company. While they’ve tried to turn things around, Icahn hasn’t let up yet.

To that end, Icahn brought in Lazard Ltd. to help squeeze things a little more. They said in the press release that Lazard will “immediately commence an in-depth strategic analysis of Time Warner’s business and operations to further identify constructive corporate alternatives.”

“Time Warner has a unique set of valuable assets and our assignment is to help determine how best to realize the full value of these assets. We look forward to working with the Icahn Group to help maximize value for all Time Warner shareholders,” said Bruce Wasserstein, Lazard Chairman and Chief Executive. He noted that Lazard is available to meet with Time Warner management, members of its Board of Directors and shareholders to review value-maximizing alternatives.

Essentially what Icahn is after is some empirical data from a third party to back up his believe the company needs an overhaul. He’s looking to clean house and dump some of the current directors. He’s not the first to butt heads though. Moguls like Ted Turner once served on the Time Warner board after they purchased his vast television empire. He’s no longer on the board.

Carl Icahn stated that “We continue to believe that Time Warner’s stock is greatly undervalued and that the company is in need of a major restructuring. Our group is extremely pleased to be working with a firm of Lazard’s stature and experience in these matters. Bruce Wasserstein and his team will help us in the election of a slate of directors to replace a majority of the existing Time Warner directors with a view to maximizing shareholder value.”

Mr. Icahn also stated that “We have brought in Lazard to complete an in-depth study of Time Warner and how shareholder value can be enhanced. It is our contention that it is only through a very meaningful and deep restructuring and share buy-back program that all shareholders will be able to realize the true value of Time Warner.”

Look for more fighting at Time Warner as this battle continues on through the winter.

John Stith is a staff writer for WebProNews covering technology and business.