AOL hopes the move will cut annual costs by about $300m
Internet company AOL has announced plans to lay off about a third of its workforce once it is spun off from media giant Time Warner.
The move will involve about 2,300 job cuts at the firm, which currently employs some 6,900 workers.
AOL and Time Warner combined in 2001, but in May, Time Warner stated its intention to spin off AOL into a separate company by the year-end.
AOL said it would impose the cuts on a voluntary and involuntary basis.
Company spokeswoman Tricia Primrose said a voluntary redundancy programme would begin on 4 December.
"We'll need to do an involuntary layoff if we do not reach the target numbers through the voluntary option," she said.
"We believe the voluntary programme gives people more choice and decision-making ability instead of waiting for the final cost recommendations and involuntary layoffs."
AOL hopes the move will help cut annual costs by about $300m (£180m).
It also says the lay-offs are likely to result in restructuring charges of up to $200m during the first half of 2010.
The company is scheduled to be spun off from Time Warner on 9 December and will begin trading as a separate entity the day after.
Shareholders will receive one AOL share for every 11 Time Warner shares already held.
The spin-off brings to an end what is regarded as one of the least successful mergers in history.
AOL bought Time Warner at the very top of the dotcom boom for $147bn, but struggled to integrate the two companies.