In 2006, Google gave AOL $1 billion in cash for a 5 percent indirect equity stake in the company. Now, in a regulatory filing with the SEC, Google believes that its investment may be worth less than a billion and may review for impairment and financial write-downs in the future.
“We believe our investment in AOL may be impaired,” Google said in its latest quarterly financial filing with the U.S. Securities and Exchange Commission.
At the time of the investment, AOL was valued at $20 billion. It has since then gone down to $10 billion based on different projections. With AOL still in the dark as to its directions and partnerships nowhere, it is only right for Google to worry about its $1 billion. With that money, they could have bought worthy companies, like Facebook in 2006?