As a result, the stock for the Walt Disney Internet Group will be converted into shares of Disney common stock.
The Internet group will continue to function as a division of the company. Disney will also continue many of its popular Web sites, such as ESPN.com, Disney.com, ABC.com and others.
"The Internet continues to be a central focus of our company's business strategy," Michael Eisner, Disney's chairman and chief executive officer said in a statement. "We believe this action should help us gain greater competitive advantage as we leverage Disney's creative content, brands and other assets."
The Internet Group has lost money every quarter since it debuted in January 1999. Last September, the company introduced a new site and strategy, abandoning its attempt to be a general purpose Web "portal."
The new site focused on leisure and entertainment and more prominently feature Disney's other sites.
©MMI The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed