Buying The Weather Channel and Weather.com got a bit rich for Time Warner (TWX). The company pulled out of the negotiations, leaving GE’s (GE) NBCU operation and its partners as potential future owners of the Landmark Communications properties.
It is a shame. Weather.com is one of the most visited websites in the US, ranking No. 15 among all US sites with 35 million unique visitors according to comScore. It would have made a strong fit with Time Warner’s CNN.com and AOL.com divisions. The Weather Channel, one of the most widely distributed cable channels would have matched up well with Turner and CNN. TWX could probably have even cut costs.
But, according to rumors, Landmark wants $3.5 billion for the weather properties. With its stock near a 52-week low, and generally under-performing other large media shares, Time Warner does not want to be seen as making any significant errors. It has over $9 billion coming in from its spin-off of Time Warner Cable (TWC).
It is a shame.
Time Warner only has a few highly attractive assets among its divisions. Its cable network operations are among those. According to the company’s SEC filings. the TV content division is among the strongest and fastest growing at the conglomerate.
TWX has been burned by M&A before, with the AOL merge topping that list. But, being gun shy only hurts the company’s chances of improving its lot.
Douglas A. McIntyre
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