Nicholas Succeeds Munro as Co-CEO of Time Warner
NEW YORK (AP) _ The guard is changing at the top of Time Warner Inc.
The company’s president, Nicholas J. Nicholas Jr., succeeds J. Richard Munro today as co-chief executive of the media and entertainment giant.
The top-level changes had been widely expected, and the 50-year-old Nicholas said no major changes are expected because he and Munro have worked together so closely for years.
″This represents continuity, not change,″ Nicholas said.
The 59-year-old Munro announced he was stepping down at the first annual meeting of Time Warner shareholders since Time Inc. completed its acquisition of Warner Communications Inc. earlier this year.
Munro had been chief executive at Time since 1980 and chairman since 1986. He shared both titles with Warner boss Steven J. Ross since Time bought a controlling interest in Warner and changed its name last year.
A onetime Sports Illustrated publisher, Munro had said he wanted to serve only 10 years as chief executive, and the company spelled out succession plans when the Warner deal was first announced in March 1989.
Munro’s contract at Time Warner entitled him to deferred compensation of nearly $4.3 million if he retired from his posts on or before this May 31.
Nicholas, 50, has been with Time since 1964 and president since 1986.
″The future belongs to him and to Steve and to the remarkable people at Time Warner. I wish you all godspeed,″ Munro told shareholders and others who filled the 1,150-seat Ziegfeld Theater for Tuesday’s 2 1/2 -hour meeting.
Ross, 62, becomes the company’s sole chairman with Munro’s retirement. Plans are for him to share the chief executive’s post for four more years, after which he is expected to leave that job entirely to Nicholas.
Time spurned a $12.2 billion buyout offer from Paramount Communications Inc. last summer and proceeded with a $14 billion purchase of Warner. The deal, completed in January, created a world leader in magazines, books, films, recorded music, TV production and cable TV systems.
Time never allowed shareholders to vote on the Paramount offer, but there were few complaints expressed Tuesday about Time’s tactics.
Shareholders rejected a proposal, which was opposed by management, calling on Time Warner to either redeem or submit to a shareholder vote a key anti- takeover defense known as a poison pill.
William Steiner, who presented the resolution, said Time management had cost its shareholders about $5 billion by rejecting Paramount’s $200-a-share offer without allowing a vote.
About 43 percent of the shares voted in favor of the proposal and 57.8 percent against, the company said.
In trading Tuesday on the New York Stock Exchange, Time Warner stock fell 50 cents a share to $94.
Ross said uncertainty about congressional efforts to impose more regulations on the cable industry had cut the value of Time Warner stock by $2.5 billion to $3 billion. Time Warner is the nation’s second biggest cable TV system operator.
One shareholder asked Ross to explain why he deserved his lucrative benefits package, under which he is entitled to deferred compensation of about $122 million.
Ross said the package mainly reflected stock bonuses and stock appreciation rights he was granted in 1987 at Warner, and noted the company he founded had grown at a remarkable pace in recent years.
Munro, who will stay on as a Time Warner director and chairman of its executive committee, joined the Time magazine circulation department in 1957.
He became president and chief executive of Time Inc. in 1980, and took on the title of chairman in 1986, passing the president’s job to Nicholas.
Munro defended the decision to combine with Warner rather than take the Paramount offer, saying the new company offered a potential ″long-term return on investments that would far outstrip any single short-term gain the sale or breakup of Time might bring.″
Time Warner lost $256 million on revenue of $10.8 billion last year, mainly because of costs associated with its purchase of a majority stake in Warner. Nicholas said a top priority is reducing the company’s $10.8 billion debt.