Time Warner Sets Ratio For Cable Spin
Distribution Set for March 27
Mike Farrell -- Multichannel News, 3/20/2009 1:24:51 PM
Time Warner Inc. set the final distribution ratio for its previously announced spin of Time Warner Cable on Friday.
According to a statement, on March 27, Time Warner stockholders will receive 0.083670 shares of Time Warner Cable common stock for every share they held of Time Warner Inc. as of the record date March 12 at 8 p.m.
Time Warner Inc. owns about 85.2% of Time Warner Cable's outstanding stock and will distribute that entire stake on March 27 to eligible Time Warner stockholders. In a statement, Time Warner Inc. said that the ratio reflects the one-for-three reverse stock split of Time Warner Cable common stock on March 12, but not the one-for-three reverse stock split of Time Warner common stock, which Time Warner will implement at 7 p.m. on March 27.
Time Warner announced last May its intention to spin-off its interest in the cable unit and received the necessary regulatory approval in February. The split will create the first large cap pure-play cable stock in the industry -- Time Warner Cable -- with no majority shareholder and no ties to programming or other non-cable systems assets.
According to the company, fractional shares of Time Warner Cable stock will not be distributed to Time Warner stockholders. Instead, those fractional shares will be aggregated and sold in the open market, with the net proceeds distributed pro rata in the form of cash payments to Time Warner stockholders who would otherwise hold Time Warner Cable fractional shares.
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