A (Steve) Case of the Pot Calling the Kettle Black [Bebo Sale]
I couldn’t believe this. Steve Case, the former head of AOL Tweeted:
“AOL buying Bebo for $850 million and then selling 2 years later for $10 million doesn’t seem like a winning strategy.”
Is this a (Steve) case of a pot calling the kettle black?
The merger of AOL and Time Warner is one of the greatest failures in M&A history.
New York Times May 2009:
When the merger was announced in 2000, the two companies had a combined market value of more than $300 billion.
By the time the deal was consummated in 2001, with Internet stocks plunging and recession taking hold, that had fallen more than $100 billion. Today, the combined market capitalization of Time Warner and the new Time Warner Cable is less than $40 billion.
Steve Case has nerve, criticizing the Bebo buy.
AOL/Time Warner went from $300 billion to $40 billion. Today Time Warner is worth $19.7bn and AOL is $2.4bn. Their total combined worth is $22.1bn.
Wow. That’s a far, far, bigger loss than Bebo.
Steve Case initiated the Time Warner deal. And it was a great deal for AOL and for him. He walked away with a lot of money.
You would think with such a disaster on his resume, Mr. Case would refrain from commenting on the AOL/Bebo deal. Clearly, Mr. Case’s hubris distances him from AOL’s subsequent adventures.
Company culture is set by its leaders.
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