Google believes $1B investment in AOL is crumbling

[flashl]

MICHAEL LIEDTKE
AP Business Writer

SAN FRANCISCO — In an assessment that could lead to a substantial charge against its future profits, Google Inc. believes its $1 billion investment in advertising partner AOL is souring.

The Mountain View-based company disclosed in a quarterly report filed late Thursday with the Securities and Exchange Commission that the 5 percent AOL stake that it bought in 2005 "may be impaired." Impairment is an accounting term used to describe an acquisition or investment that has eroded.

Unless there is an about-face, the acquiring company eventually must absorb a charge on its books to account for the diminished value of its holdings.

Google acknowledged for the first time that it might have to recognize a loss on its 5 percent stake in AOL, whose struggles have made it a financial albatross for its owner, Time Warner Inc.

"There can be no assurance that impairment charges will not be required in the future, and any such amounts may be material," Google said of its AOL investment.

[girl gone mad]

1. Wow..

If only they had asked me, I coulda told them not to touch AOL. Instead, some dumb suits probably made a fortune putting this bad deal together.

[TransitJohn]

2. As long as

they quit mailing me those goddamn cds every two days, it's all good.