The company reported third quarter profits totaling $76 million in October, but that’s a significant drop from the $6.8 billion in profits Yahoo reported a year ago.
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Given Yahoo’s $30 billion ownership stake in Alibaba Group Holding Ltd (NYSE: BABA), some investors speculated that Alibaba could be a potential buyer of Yahoo’s segment.
The executive board at Yahoo is now exploring a range of options on how to best manage a number of their Internet businesses, including the sale of web properties, with talks set to take place Wednesday through Friday, unnamed sources told The Wall Street Journal.
Analysts think shoppers could include phone giant AT&T, search engine companies Google and Microsoft, and even Rupert Murdoch’s NewsCorp, which owns news publications like The Wall Street Journal. If the board decides to opt for the sale of its core internet business, then the shockwaves of this decision could topple Mayer position within the company.
Its stake of 15% in Alibaba has a current worth of $32 billion, while its stake of 35% in Yahoo Japan is worth approximately $8.5 billion.
“I have very aggressive expectations for Yahoo’s core business”, Ms Mayer said on the call.
Yahoo! Inc. (NASDAQ:YHOO)’s Chief Executive Officer, Marissa Mayer has been making efforts to attract users towards the company’s products including Yahoo Mail and search. Since Yahoo’s total market capitalization is $31 billion (£20.7 billion), stock market investors “are valuing Yahoo’s core business at less than zero if the Asian assets were spun out tax-free”.
Private equity firms are likely to be the potential buyers for Yahoo’s Internet business, according to the report.
Yahoo (Hanover: YHO.HA – news) is considering a radical move to sell off its core business as a three-year turnaround effort from Marissa Mayer fails to bear fruit, according to reports. “What’s going on now also has echoes of what Twitter just went through – rumors largely generated by those interested in goosing Yahoo’s stock and a willing media ready to help generate froth”, she wrote.
Industry analysts point out that snapping up Yahoo’s internet operations would instantly make SoftBank a global player in the sector, notably widening its digital platform for entertainment and e-commerce outside of Japan.
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Mayer is also blamed by experts for Yahoo’s acquisition of Tumblr for a whopping $1.1 billion in 2013.
