AOL Time Warner will not keep any of the Tom.com shares it received in return for giving the Li Ka-shing-controlled company a majority 64 per cent stake in Chinese Entertainment Television Broadcast (CETV), it emerged yesterday. The surprise development highlights just how high a price AOL paid to extract itself from the channel, which lost US$17 million last year on revenues of just $450,000. According to a document submitted yesterday by Tom.com to the Hong Kong stock exchange, all of the 21.25 million shares issued by Tom.com to fund its acquisition will be transferred by AOL Time Warner subsidiary Turner Broadcasting Systems (TBS) Asia Pacific to Robert Chua and Lark International Holdings, in consideration for their combined 20 per cent holding in CETV. '[Tom.com] has consented to the proposed transfer of the consideration shares by TBS to Lark and Mr Chua ... 17 million shares will be transferred to Lark and 4.25 million will be transferred to Mr Chua by TBS,' the statement said. Tom.com added that the transfer was conditional on Lark and Mr Chua agreeing to a lock-up period whereby they could sell half the shares after six months and the remainder after a year. According to sources close to the deal, AOL also had to clear all of CETV's debts and shareholder loans - estimated at between US$5 million and $6 million - before the transaction. AOL appears to have reaped just two benefits from the deal, which leaves it with a minority 36 per cent stake in CETV. It no longer has to fund CETV's monthly operational costs of US$1 million, and has the option to buy back Tom.com's 64 per cent stake before July 2010 should CETV be turned around. In a related development yesterday, Tom.com also snapped up more than HK$1 billion in cash from investors on the heels of its deal with AOL. Through a top-up share placement, Tom.com sold 450 million shares at $2.30 each, raising $1.03 billion. The placement price represented a 6.1 per cent discount to Tom.com's closing price on Wednesday. Banking sources said the deal, which was more than 2.5 times oversubscribed, was well-received by investors on the back of its CETV acquisition and widespread expectation that the company would post good second-quarter results. Owing to strong demand from investors and hedge funds, placing agent Citigroup enlarged the original offer size by 100 million shares and priced the deal at the top-end of its HK$2.23 to $2.30 range. The shares represented 11.8 per cent of Tom.com's enlarged share capital, diluting the interests of its three major shareholders - Hutchison Whampoa, Cheung Kong (Holdings) and Chau Hoi Shuen - by less than 1 per cent. '[Tom.com] was opportunist,' said Peter Schloss, the managing director of Mediavest. 'They announced the deal and took advantage of the rising market.' '[Tom.com chief executive] Sing Wang is a voracious dealmaker,' Mr Schloss added. 'But he needs to prove he can integrate his businesses.'