Time Warner Announces IPO
In an announcement made on Wednesday October 18, the world's largest media company, Time Warner, filed for an initial public offering that could see the company valued at more than $40 billion according to documents submitted to the Securities and Exchange Commission.

As the second largest cable television provider in the United States, Time Warner would retain 84 percent control after the IPO. When its shares are listed on the New York Stock Exchange (most probably as TWC), Time Warner should raise approximately $100 million of additional capital.

The money raised will be used to pay off the creditors of Adelphia Communications, an entity Time Warner acquired in June. Those creditors include William Huff, W.R. Huff Asset Management Co., Aurelius Capital Management, Catalyst Investment Management, and Perry Capital LLC.

Adelphia had been in bankruptcy protection since June 2002 as a consequence of accounting fraud. The company filed Chapter 11 owing more than $18 billion to creditors.

Morgan Stanley values Time Warner's cable operations at $43 billion with the 16 percent stake owned by Adelphia at $5.5 billion.

Time Warner owns AOL, Warner Bros, movie studio, People Magazine and CNN. Shares in the media giant have gained some 11 percent during the year but lag behind Walt Disney Co. with 31 percent and News Corp. Comcast Corp. with 47 percent.

In total, Time Warner Cable has 14.4 million customers for its basic service package and sells enhanced services such as high speed Internet access, digital phone service, and video on demand.