AOL to cut its workforce, split from Time Warner

AOL, Inc. has announced it will cut its work force by at least one third, and estimates than loss to equal about 2,500 employees, according to the New York Times.

AOL merged with Time Warner in 2000, but on Monday, AOL announced that the Time Warner board of directors had analyzed data and declared a pro rata dividend of the shares of AOL common stock owned by Time Warner that will result in the complete legal and structural separation of the two companies.

The new AOL will be a publicly traded company independent from Time Warner.

AOL executives said they need to save about $300 million per year with the cuts.

According to the article, AOL said it will ask for volunteers first, and then resort to layoffs if it doesn’t get roughly 2,500 people to accept a buyout package.

AOL’s chairman, Tim Armstrong, told his employees that he will not be accepting his expected $1.5 million bonus this year.

At its historical peak, AOL had more than 20,000 workers in 2004. That number is now down to 4,400.

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