Companies: Coup at the Top

A sudden shake-up in Time Warner's executive suite breaks a management stalemate and gives the company a new line of succession

The arrangement was supposed to be cut and dried, even ironclad. Not only did it designate Nicholas J. Nicholas Jr. the sole heir to Steve Ross as head of Time Warner Inc. The 1989 merger agreement that created the world's largest media company also spelled out the date of his accession -- five years in advance. As of 1994, Ross, while remaining chairman, would step aside as co- chief executive officer, and president Nicholas would become the sole CEO.

Except that it didn't work out that way. Last week, with two years to go before his accession, Nicholas, 52, found himself...