Time Warner on Thursday named Jeffrey Bewkes chairman, and in so doing, the company confirmed that former captain Richard Parsons will step down on Dec. 31.
Bewkes officially succeeded Parsons as CEO of the media conglomerate on Jan. 1, 2008. While negotiating the terms of his contract, the 56-year-old locked in a guarantee that he’d assume the chairmanship no later than Jan. 1, 2009.
The terms of Bewkes’ contract with Time Warner include a base salary of $2 million upon his election as chairman and an annual discretionary cash bonus with a target amount of $8.5 million. An additional long-term incentive package puts Bewkes’ total compensation at as much as $19 million.
In a statement released by Time Warner, Bewkes thanked his predecessor for his role in steering the company out of the ruins of the AOL merger. “I am especially grateful to Dick Parsons for his stewardship of Time Warner. During very challenging times, he stabilized the company and built a solid foundation for our growth,” Bewkes said. “He has been a great leader for all of us at Time Warner.”
Parsons became CEO of Time Warner in May 2002, the year after AOL bought the company for $124 billion. The ill-fated takeover resulted in some $100 billion in writedowns and shareholder lawsuits, and Parsons spent the next three years working to return Time Warner to profitability.
In 2003, Parsons sent morale soaring at Time Warner when he excised the “AOL” prefix from the company’s name.
While Parsons scrubbed AOL off the letterhead, the unit remains an albatross. Bewkes earlier this week said Time Warner is still exploring alternatives for AOL, including a sale or merger with the likes of Yahoo.
On the other side of the ledger, Time Warner’s sale of its majority stake in Time Warner Cable has netted a dividend of $9.5 billion, although Bewkes said he wouldn’t put any of that capital toward acquisitions in the new year.
Bewkes served as president and COO of Time Warner from 2006 to 2007, after having steered the company’s entertainment and networks group. Before throwing his lot in with corporate, Bewkes put in seven years as chairman and CEO of HBO.