Cable pioneer Ted Turner has severed his remaining ties with an industry he helped create, exiting Time Warner’s board of directors Friday with a few poignant remarks.
“I just wish that over the last five years I could have made a bigger contribution. I didn’t have the opportunity, unfortunately, but I hung in there … I’ve done my best,” Turner said at TW’s annual shareholders meeting in Atlanta.
Turner transformed television in 1976 when he turned a local Atlanta UHF station into a nationwide “superstation,” going on to launch CNN in 1980. He sold his Turner Broadcasting to Time Warner in 1996, ceding control but remaining a key executive and a large shareholder of the combined company.
Turner’s flamboyance was increasingly at odds with the buttoned-down culture of the modern media conglom.
When Time Warner and AOL merged in 2001, former TW topper Gerald Levin stripped Turner of all operating responsibility, relegating him to the post of “senior adviser,” a move the “Mouth of the South” found devastating.
“Good night, and good luck,” Turner said, using the title of the Warner Independent Pictures film about newsman Edward R. Murrow.
“Today we are saying goodbye to Ted Turner. It’s an historic day, albeit a sad one. Ted ranks up there with Henry Luce and Jack Warner and all those larger-than-life figures who really shaped the way we see the world,” said TW chairman-CEO Richard Parsons.
Turner runs a nonprofit against nuclear proliferation and is an active environmentalist. A large part of his fortune, held in stock, was wiped out by the TW-AOL merger.
Turner, who also happens to be the largest private owner of ranchland in the U.S., is expanding his bison-burger restaurant chain, Ted’s Montana Grill.
Turner’s mild barbs were nothing compared with what TW might have faced. For a good part of last year, the company was threatened with a nasty proxy fight by corporate raider-turned-shareholder activist Carl Icahn. He and allies bought shares and launched an aggressive campaign to oust Parsons, elect new directors and split the company into four pieces to boost the sluggish stock.
Icahn couldn’t get enough traction on Wall Street and backed down at the 11th hour — just before the deadline to name an alternate board slate.
But the shares still haven’t budged.
Parsons acknowledged the stock is “stalled,” attributing it to investors’ concern with “new technologies that are creating new business models and creating new competitors for our existing businesses.” He insisted that time and strong performances of TW’s businesses will ultimately win over the market.
That includes the slow turnaround of AOL. Parsons said he’s committed to revamping the unit despite grumbling by one shareholder at the meeting that it should be cut loose.
He also assured stockholders that the company’s planned $20 billion stock buyback — a figure first suggested by Icahn — has to eventually boost the stock. TW is about halfway through the buyback.
Parsons said TW will aggressively tackle costs. In its “settlement” with Icahn in February, the conglom said it has a plan to cut costs by $500 million this year and is looking to slash another $500 million in 2007.
Until Time Warner stock revives, the company remains vulnerable to agitators like Icahn and to speculation over a potential takeover. Not many companies would be able to digest such a large purchase — TW posted revenue of $44 billion last year. But there have been on-again, off-again rumors of interest by Microsoft in particular.
Parsons wooed shareholders with clips of “Superman Returns” and the penguin toon “Happy Feet.” He said TW continues to “scan the horizon” for acquisitions and expects the purchase of bankrupt Adelphia Communications to be settled by late July. The deal will be accompanied by a spinoff of Time Warner Cable. And TWC will then be the largest cable operator in both New York City and Los Angeles, Parsons said.
He confirmed that Time Warner is in active talks to sell the Atlanta Braves baseball team.
Former AOL exec Miles Gilbourne and former U.S. trade representative Carla Hills also stepped down from TW’s board Friday, leaving it with 11 members. Time Warner has pledged to name two more independent directors.