• The Wall Street Journal, Friday, December 26, 2008 1:45 PM

At a time when liquidity is scarce, Time Warner is being given the unique opportunity to reinvent itself, The Wall Street Journal reports, as the company prepares to spin off its cable for an expected $9 billion in cash. However, at a recent industry conference, CEO Jeff Bewkes revealed that instead of reinvesting in its existing businesses or adding new ones to its portfolio, Time Warner will use the cash windfall to reward shareholders in the form of dividend yields and strategic stock repurchasing programs.

"I don't want to rule (acquisitions) out, but they have been the cause of most of the value destruction in media companies, and that certainly has been the cause for a lot of value destruction at our company," the Time Warner chief said. "We think first about what's the appropriate return of capital to shareholders in the form of dividend yields and return of capital through steady and predictable buybacks."

Meanwhile, AOL continues to weigh down the media giant. Bewkes has already sunk $850 million into Bebo, an online social network, in an effort to revive the ailing Web portal, but the acquisition has so far been viewed as a disappointment. As the Journal reports, whatever Bewkes does with the money gleaned from the sale of Time Warner Cable "will likely define his legacy at the company's helm as a long-awaited success or yet another disappointment."

Read the whole story at The Wall Street Journal »