Verizon deal extends four-year surge in AOL’s stock price
Specialist Ronnie Howard on the floor of the
AOL Inc.’s stock price soared Tuesday in response to the merger agreement with Verizon Communications Inc., extending a four-year rally in AOL’s shares.
After the companies said Verizon would buy AOL for $50 a share, or $4.4 billion, AOL’s stock jumped $7.93 a share, or 18.6%, to $50.52 in afternoon trading.
The stock has now surged five-fold since August 2011, when it was trading just above $10 a share.
A pioneer Internet provider with its dial-up service, AOL was known as America Online when it went public in 1992 for a split-adjusted 9 cents a share.
AOL later combined with Time Warner Inc. in a $186-billion megamerger in 2001, only to see the marriage crumble within a few years and become known as one of the worst deals in corporate history.
Time Warner spun off AOL back into a separate company in 2009. AOL then reinvented itself as a digital media company, with assets that include the Huffington Post, original video programs and advertising platforms.
AOL generated revenue of $2.53 billion last year and turned a profit of $125.6 million.
Here are some key dates in AOL’s history:
1985: Quantum Computer Services Inc., which later becomes America Online Inc., launches its first online service, Q-Link.
1992: America Online’s stock goes public.
1995: AOL.com debuts.
2001: AOL and Time Warner complete their merger, creating AOL Time Warner.
2003: AOL Time Warner posts a $99-billion loss for 2002, mainly due to writing down the sinking value of its Internet unit and other properties. AOL is dropped from the corporate name.
2009: Time Warner spins off AOL and Time Warner Cable. Former Google Inc. executive Tim Armstrong becomes AOL’s chief executive.
2011: AOL acquires the Huffington Post.
2015: Verizon Communications Inc. agrees to buy AOL for $4.4 billion.
