Investor Backs Time Warner CEO

Time Warner Inc. Chief Executive Richard Parsons, under the gun from financier Carl Icahn to boost the media conglomerate’s stock price, received a vote of confidence Tuesday from the world’s fifth-richest man.

“We have full trust and confidence in Mr. Parsons,” Saudi Prince Alwaleed bin Talal said in an interview from Paris. Alwaleed owns about 1% of New York-based Time Warner.

Separately, Alwaleed also reiterated his support for another media chief, News Corp. Chairman Rupert Murdoch, in raising his stake in News Corp. to 5.46% of the voting shares, Alwaleed’s office announced.

The prince’s new holding of Class B voting shares replaces the 3% stake in Class A nonvoting shares previously held by his investment company, Kingdom, it said in a statement.

Alwaleed gave his backing to Murdoch in November and said he could buy more News Corp. stock to support him in the face of a possible hostile takeover bid by Liberty Media Corp.

“Last November I said that I had the utmost confidence in Mr. Murdoch, his management team and his succession planning, and that if necessary, the Kingdom companies would replace their nonvoting shares with voting shares,” he said in a statement Tuesday.

At Time Warner, Parsons, 57, has been facing pressures from Icahn, who built up a 2.6% stake in the company and is pushing for changes including a $20-billion share buyback and a spinoff of the company’s cable-television unit.

Alwaleed, whose support may help Parsons counter the billionaire investor, said he would “defer to Mr. Parsons to decide” whether those actions would be appropriate to help increase the stock price.

“Any matter that would cause the stock to reach new highs, we would support,” whether the plan comes from Icahn or from Parsons, Alwaleed said Tuesday. Alwaleed said he had talked to Parsons since Icahn’s meeting.

Spokeswoman Susan Duffy declined to comment on Alwaleed’s remarks.

Time Warner owns such assets as America Online, Time magazine, CNN and the Warner Bros. film studio,

In his three years at the helm of Time Warner, Parsons has reduced net debt to $13 billion, sold a music unit and returned the AOL unit to profit. He settled a probe by the Securities and Exchange Commission and started to focus the company on revenue growth. Now Parsons is planning a $5-billion share buyback, the first in four years, and has started a dividend.

In April, Time Warner agreed to buy cable systems from Adelphia Communications Corp. for $17.6 billion in a joint bid with Comcast Corp. The company plans to sell a 16% stake in the business in an initial public offering next year.

The moves haven’t helped the shares so far. At $18 a share, the stock is about unchanged from two years ago.