AOL To Cut About 2,300 Workers If Time Warner Spin-Off Goes Through2:40 PM EST Thu. Nov. 19, 2009
AOL on Thursday told its employees that about one-third of them will have to leave the company if a proposed spinoff of AOL by Time Warner goes through as planned.
Time Warner on Monday said it would spin AOL off as a separate company, ending a decade-long relationship which started with Time Warner hoping to meld its traditional print and broadcast media with what was then AOL's strong Internet-based presence to create a media powerhouse, but which ended in much disappointment for the company.
Time Warner said in May that it plans to spin AOL off as a separate company by year-end.
AOL said in a report filed with the SEC on Thursday that it has told its employees that restructuring activities related to the spinoff, assuming it goes through as planned, would result in one-third of them being let go "on a voluntary and involuntary basis."
In the filing, AOL also said the goal of the restructuring is to cut ongoing annual operating costs by about $300 million, and is expected to result in restructuring charges of up to $200 million through the first half of 2010.
The Wall Street Journal reported on Thursday that AOL currently has about 6,900 employees, which is way below its peak employment of 20,000 people in 2004.
AOL CEO Tim Armstrong on Thursday told employees that the company will be looking for about 2,500 voluntary layoffs, but the company will also use involuntary layoffs if needed, The Wall Street Journal wrote.