Zara Analysis
Zara Analysis
repared for:
Athens AOL Time Warner Management
Prepared by:
Courtney Tucker
Briana Jenkins
Hilary Gilway
Stefanie Walsh
Roberta Wainwright
Date: 3.7.2001
Team Four
Copeland Hall
Ohio University
Athens, Ohio 45701
March 7, 2001
Athens AOL Time Warner
28 Station Street
Athens, Ohio 45701
Dear Chairman of the Acting Board of Overseers of the Athens Time Warner Cable Company, Dr. James Perotti, Dr. Arthur Marinelli, Prof. Larry Rogers, Prof. Greg Waller:
After thorough research of your company, evaluating its assets and industries at national and local levels, we have assembled a comprehensive consulting report that identifies the benefits and drawbacks of your recent merger and how it will be realized in the City of Athens by 2003.
The report will address AOL Time Warners current role in the entertainment and telecommunications industries by highlighting and evaluating the operating, financial and tax synergies on the national and local scope.
In consulting AOL Time Warners role in Athens, we have researched the benefits, and future outcomes that could result from the merger, taking into consideration the anticipated problems and solutions. This report not only supports AOL Time Warners prospects in the future, but also demonstrates the companys opportunity to grow and develop new technologies in comparison to its competition.
Through research and reflection, we have expanded our outlooks on the telecommunications and entertainment industries and gained consulting experience in the field of enhanced technology. We have appreciated this opportunity to work with you and look forward to seeing the AOL Time Warner merger succeed.
Sincerely,
Team 4
Table of Contents
Executive Summary iv
Introduction 1
Industry 1
Competition 2
Broad Scope of AOL Time Warner Merger 3
Operating Synergies 3
International Components 3
Management 3
Employees 4
Cross Promotion 4
Financing Synergies 5
Stock Price 6
Financial History 6
Pro Forma Financials 7
Tax Synergies 7
Local Scope in the City of Athens, Ohio 8
Operating Synergies 8
Cross Promotion 8
Demands of Increased Accounts 8
Cable Franchise Ordinance 9
Potential Customers 9
Financing Synergies 10
Conclusion