SEC Filings

WARNER MEDIA, LLC filed this Form S-4/A on 03/24/2000
Entire Document
  .  increased subscriber growth through cross promotion and marketing
     opportunities between Time Warner's brands and content and America
     Online's brands and interactive services;
  .  efficiency in marketing across different platforms and distribution
     systems, including cable, publishing and interactive services;
  .  cost synergies in areas such as technology and network infrastructure,
     direct mail and interactive marketing, use of "evergreen" billing
     systems, sales forces and other corporate services; and
  .  cost efficiencies in launching and operating interactive extensions of
     Time Warner brands.
   In all, management estimated for the board of directors of America Online
that total EBITDA synergies would be approximately $1 billion in the first full
year of operations, producing an EBITDA growth rate of approximately 30% in
that first year. It is anticipated that the combined company will have a
revenue base in excess of $40 billion and EBITDA of approximately $11 billion,
including synergies, in the first full year.
   The board of directors also took note of the fact that the merger is with a
long-time business partner of America Online with a proven history of
successful collaborations, including cross-promotion and marketing activities
between the two companies. Both companies also have management teams with
demonstrated ability to manage the integration process of major business
   Information and Factors Considered by the America Online Board of
Directors. In connection with its approval of the merger and recommendation
that stockholders approve the merger, the board of directors of America Online
consulted with its legal advisors, including its General Counsel and
representatives of Simpson Thacher & Bartlett, outside counsel on the
transaction, regarding the duties of the members of the board, as well as with
members of management and its financial advisor. The America Online board also
considered the following material information and factors in reaching its
determination to approve the merger agreement:
  .  the reasons described under "--America Online's Reasons for the Merger;"
  .  the exchange ratios being used in the merger and the resulting
     continuing 55% ownership interest in AOL Time Warner by America Online's
     stockholders and the history of the negotiations between America Online
     and Time Warner;
  .  presentations by senior members of America Online's management regarding
     the strategic advantages of combining with Time Warner, operational
     aspects of the transaction, and the results of management's operational
     and legal due diligence review;
  .  historical information concerning America Online's and Time Warner's
     respective businesses, financial performance and condition, operations,
     technology, management, competitive position, and stock performance;
  .  America Online management's view as to the financial condition, results
     of operations and businesses of America Online and Time Warner before
     and after giving effect to the merger based on management's due
     diligence and publicly available earnings estimates;
  .  the strategic fit of America Online and Time Warner, including the
     belief that the merger has the potential to enhance stockholder value
     through the numerous growth opportunities and synergies resulting from
     combining the two companies' complementary strengths and assets,
     including additional opportunities for e-commerce, growth in
     subscribers, cross-promotions, and operating efficiencies;
  .  the opportunities and alternatives available to America Online if the
     merger were not to be undertaken, including pursuing an acquisition of
     or business combination or joint venture with entities other than Time
     Warner and the conclusion that a combination with Time Warner is
     expected to yield greater benefits and is more feasible than the