AOL's Levin to step down early

AOL Time Warner, the world's biggest media company, has announced that its chief executive Gerald Levin will take early retirement.

Mr Levin will be replaced by the company's co-chief operating officer Richard Parsons.

Mr Levin helped shape AOL Time Warner

The move will leave Robert Pittman as AOL's sole chief operating officer.

Mr Levin's decision to step down in May 2002, at the age of 63, has surprised analysts who were not expecting him to leave so soon.

"Most people expected Levin to spend another two to three years at the company," said Paul Kim, an analyst at Kaufman Brothers.

Mr Levin said he would pursue his "sensitive, creative" side once he retires.

"Everyone's trying to figure out the timing of it. It has nothing to do with any business activity or transaction," he added.

Steve Case, the founder of America Online, will remain as chairman.

Wall Street was unperturbed by the job shuffle. The company's shares fell initially, but closed up more than 3% at $35.83.

Parson's rise

Mr Parsons was appointed president of Time Warner in 1995, before later becoming co-chief operating officer following the $106bn merger with America Online.

Mr Parsons came from Time Warner

Before joining Time Warner, Mr Parsons was chairman and chief executive of Dime Bancorp, a US savings bank.

Mr Pittman, who will now report to Mr Parsons, had originally been tipped to take the top job after Mr Levin's departure.

However, analysts said there was still time for Mr Pittman, who is 47, to become chief executive after Mr Parsons, who is 53.

In an internal memo to staff, Mr Levin said his decision to retire had come after a year-long debate about the succession with the company's board and "much personal reflection".

Mr Parsons' promotion will make him one of the most powerful African-Americans in corporate circles.

Levin's retreat

Mr Levin, who spent almost his whole career at Time Warner, played a major role in shaping the merged AOL Time Warner.

I felt that once my work was completed and I was satisfied with the company's direction and progress, I'd invoke that provision

Gerald Levin

Earlier, as well as overseeing the merger between Time and Warner, he led Time Warner's acquisition of Turner, which included CNN.

Mr Levin also revealed on Wednesday that he asked for a provision to be inserted into his employment contract in 1997 to allow him to retire early.

The provision was included after Mr Levin's son, an English teacher, was murdered by a student.

Mission completed

Mr Levin wrote in the memo: "I felt that once my work was completed and I was satisfied with the company's direction and progress, I'd invoke that provision and turn my full energies to the moral and social issues I feel so passionate about.

Mr Case and Mr Levin created a media giant

"That time has arrived."

The merger of AOL and Time Warner has formed a company with more than 32 million subscribers and massive media interests.

The empire includes cable networks CNN and HBO, movie studio Warner Bros and magazine Time.