TWC pays off Time Warner; plans reverse stock split

Fri, 02/27/2009 - 7:25am
Brian Santo

Time Warner Cable declared a special cash dividend of $10.27 per share of its common stock, essentially a payoff demanded by parent Time Warner Inc., the majority holder of TWC stock.

The special dividend is expected to aggregate approximately $10.9 billion, TWC said. Given that Time Warner owns about 85 percent of TWC stock, Time Warner should expect a windfall of about $9.25 billion.

In connection with the special dividend payment, Time Warner Cable will perform a one-for-three reverse stock split of the Time Warner Cable common stock, which it expects to implement after the close of business on March 12.

As a result of the reverse stock split, every three shares of issued and outstanding Time Warner Cable common stock will automatically be combined into one issued and outstanding share of common stock without any change in the par value of such shares, the company said.

Time Warner said the separation will be accounted for as a tax-free spin-off.

More Broadband Direct 02/27/09:
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•  Brenner to depart NCTA
•  TWC pays off Time Warner; plans reverse stock split
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•  Yahoo names Ko to lead mobile team
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