AOL Should Divest Moviefone And MapQuest Dissident Shareholder Says

UPDATE, 11:05 AM: AOL changed its mind and just released a statement in response to this morning’s letter from Starboard Value’s Jeffrey Smith. Looks like Moviefone and MapQuest won’t be shopped around: “We are continuing to work on the comeback of AOL and have a plan that is beneficial for employees, customers and shareholders. We believe strongly that all of our brands are important to our brand portfolio. We will continue to update investors as we execute on our plan.”

PREVIOUS, 8:49 AM: AOL isn’t commenting this morning on the latest missive from activist investor Jeffrey Smith, who says that the Internet content and access company has failed to deliver for shareholders. Smith’s Starboard Value owns 5.2% of AOL — and he’s proposing a slate of five candidates, including himself, for its board. Today he kept the pressure on with a public letter to directors urging them to stop postponing the company’s annual meeting, and to unload underperforming properties including Moviefone and MapQuest.  AOL paid $525M for Moviefone and $1.1B for MapQuest in 1999. “These prices are likely well in excess of the current market value of these assets,” Smith said so a sale could generate Net Operating Losses that AOL could use to reduce its taxes. He also applauded reports that AOL has hired Evercore Partners to explore the possibility of selling the company’s portfolio of patents for Internet processes in areas including e-commerce, travel navigation, and search-related advertising. CEO Tim Armstrong has likened them to “beachfront property in East Hampton.” But Smith says the company should treat a potential sale with “a sense of urgency due to the relatively short remaining lives of some of the material patents.”

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This article was printed from https://deadline.com/2012/03/aol-should-divest-moviefone-and-mapquest-dissident-shareholder-says-251062/