AOL buying out partner

Wednesday, Aug. 21, 2002 | 11:12 a.m.

NEW YORK -- AOL Time Warner Inc. is buying out AT&T Corp.'s stake in their cable television, moviemaking and programming partnership for an estimated $8.5 billion to $9 billion, and said it may sell a stake in its cable TV operations in an initial public offering as early as next year.

AOL Time Warner owns about 72.4 percent of the partnership, and AT&T owns the rest.

AT&T gets $2.1 billion in cash and AOL Time Warner stock valued at $1.5 billion, as well as a 21 percent stake in the Time Warner Cable Inc. business in exchange for its stake in the partnership. The cable assets boost the total value of the deal to more than $8.5 billion.

For its part, AOL Time Warner gets full ownership of Warner Bros. and HBO and stakes in Comedy Central, Court TV and The WB Network.

In addition, AT&T and Comcast Corp., which is buying AT&T's cable TV business, have agreed to make America Online's high-speed version of its Internet service available on Comcast's cable systems.

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