The Atlanta Journal-Constitution Knight Ridder/Tribune Business News
Jan. 31--What now for Ted Turner?
In announcing plans to quit as vice chairman of AOL Time Warner, Turner sparked a spree of speculation about his plans.
First he faces a decision about staying on the corporation's board as a director --- keeping him inside the management loop --- or leaving the parent of Atlanta-based Turner Broadcasting System entirely when his resignation as vice chairman takes effect in May.
Then there's talk of a run at one of the company's Atlanta sports teams, or its CNN unit, Turner's brainchild. One widely read but unconfirmed Internet report Thursday had him in hot pursuit of both.
A person close to Turner said he knows of 'no signs' of such a bold plan.
Still, he acknowledged that Turner is the sort of financial legend who might be approached by groups trying to put together such deals, and anything's possible --- especially for a lifelong maverick who loves the spotlight.
Turner himself is lying low on one of his western properties. He is scheduled to do several media interviews late next week to promote 'Gods and Generals,' a Civil War movie by his independent film company.
In announcing his plans Wednesday to give up his AOL Time Warner title, Turner, 64, said he wants to spend time on his various philanthropic and 'socially responsible' business ventures. They range from his Nuclear Threat Initiative to a new chain of restaurants serving bison meat.
Porter Bibb, a Turner biographer who runs a media and technology investment firm, doubts such a grabbag of ventures will satisfy Turner.
'He used to have a sign on his desk that said, 'Lead, follow or get out of the way.' I think he's getting out of the way, but he doesn't intend to disappear into the woodwork,' Bibb said.
'He is definitely not going to spend his sunset years in philanthropic pastimes. . . . We are talking about the most competitive individual in the world, a hyper example of a Type A personality who can't sit still.'
Despite the lofty title of vice chairman, Turner made no secret that he felt marginalized and that he wasn't consulted as much as he should have been --- especially since the 2001 merger of America Online and Time Warner, a marriage that so far has been a massive money-loser. Turner, whose personal stake in the company has sagged along with its stock price, sold his Atlanta broadcasting businesses to Time Warner several years earlier.
Although it's unknown if any specific event prompted Turner's decision, Bibb said he spoke with close friends of Turner's who noted that he had not been considered a candidate for AOL Time Warner chairman --- even in an interim role --- after Steve Case announced plans on Jan. 13 to step down.
'He was sitting there like a bride at the altar waiting for the call and it didn't come,' Bibb said.
There may have been other flashpoints. A former TBS executive said Turner didn't learn of CNN chief Walter Isaacson's impending departure --- announced Jan. 14 --- until after AOL Time Warner Chief Executive Richard Parsons did. Nor was he consulted about who should replace Isaacson, the executive said.
Other people suggest Turner simply feels free to leave now that Case has joined former AOL Time Warner chief executive Gerry Levin, whom Turner openly disliked, in departing.
Now the question is whether Turner will remain a nonexecutive board director or sever all formal ties to the company. There are pros and cons, according to experts. Parsons has reportedly asked Turner to stay on the board, and plans to meet with Turner to discuss it.
Some say that by leaving the board, Turner would be able to criticize AOL Time Warner management more forcefully.
'Obviously, there is certainly great potential influence arising from membership on the board,' said Michael Rosenzweig, senior partner at McKenna, Long & Aldridge, an Atlanta law firm.
'On the other hand --- and I'm not offering a view with regard to Turner --- one can imagine a situation in which a director may feel frustrated or effectively disenfranchised and may wish the greater freedom to speak publicly that he or she would enjoy off the board.'
Staying on the board as a nonexecutive director would keep Turner closer to the decision-making. As a non-executive director, he could serve on key board committees that executive directors can't. He could stay in board meetings during discussion on items that require executive members to leave.
The former TBS executive said Turner is being urged by those who worked with him in Atlanta to stay on the board to protect CNN. Some CNNers are worried about a possible merger with ABC News and see Turner as a shield on the board.
If he decides to quit the board entirely, it has been suggested that Turner could more easily strike a deal to buy some of the company's assets, such as its sports franchises.
'Technically, it would make it easier for Turner to purchase assets from the company because he no longer would be a director, so such a transaction would not be a 'related-party' transaction,' Rosenzweig said.
'On the other hand, given his substantial stock ownership, and his history with the company, one would expect any transaction between the company and Turner to be very closely scrutinized by analysts, by the board and more generally by the company's shareholders.'
Federal rules require special disclosures in related-party transactions.
Turner is AOL Time Warner's largest individual shareholder, with nearly 132.5 million shares, or about 3 percent of shares outstanding. Shares in the company peaked at $57 in May 2001. They closed Thursday at $12, down $1.96, following Wednesday's release of a huge fourth-quarter and full-year loss.
Turner sold nearly 4 million shares between February 2001 and last October.
Bibb predicts Turner will end up stepping down from the board, a move that would make it easier for him to sell more shares. He may also mount a bid to join with others who might be interested in buying part or all of AOL Time Warner, Bibb said.
Bibb said he believes it is unlikely Turner will buy the sports teams, and he doesn't think AOL Time Warner wants to put CNN up for sale.
Brad Turell, spokesman for Turner Broadcasting System, said people at the Atlanta television units were surprised by the 'suddenness' of Wednesday's announcement.
'However, everyone here feels that Ted isn't leaving the stage,' Turell said. 'He will always have a spotlight on him. He will always create news.
And he will always be a leader.'
Lou Dobbs, host of CNN's prime-time business news program and a friend of Turner's, said he wouldn't be surprised by anything Turner does.
'The first thing he will do is whatever the hell he wants,' Dobbs said, 'and he will surprise us.'
By Maria Saporta and Robert Luke. Staff writers Matt Kempner, Caroline Wilbert and Shelley Emling contributed to this report.
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(c) 2003, The Atlanta Journal-Constitution. Distributed by Knight Ridder/Tribune Business News.
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