RealTime IT News

AOL Paying $388 Million for MovieFone

America Online Inc. continued its buying spree Monday announcing it will buy MovieFone Inc. in a $388 million stock deal.

AOL said the purchase will strengthen the offerings in its Digital City entertainment guides by giving consumers the ability to quickly look up movie times and purchase tickets in a variety of markets across the country.

MovieFone will be renamed AOL MovieFone and will expand its online ticketing ability. The service will also receive distribution and promotion across much of the AOL network.

AOL President and Chief Operating Officer Bob Pittman said the deal will add an exciting new local e-commerce capability to AOL, which it plans to build on.

"MovieFone's frequently used service is a perfect fit with Digital City and our other brands -- one we are uniquely positioned to build. MovieFone's frequently used service is a perfect fit with Digital City and will provide an important benefit to AOL members and Internet users...

"By putting AOL's resources behind MovieFone, we will substantially enhance its already impressive performance and revenue potential."

MovieFone's board has already endorsed the deal, which still must be approved by its shareholders as well as AOL stockholders. AOL said MovieFone founder Andrew Jarecki and his three co-founders will keep their positions.

Jarecki said the deal gives MovieFone the opportunity to reach a greater number of moviegoers who turn to the Internet for information.

"Today's moviegoers demand instant access to movie listing and tickets and with the unparalleled distribution of AOL, we can make going to the movies more convenient than ever," he said.

Jarecki said the combination creates a powerful marketing force that will allow studio and theater partners to reach an even greater audience.