Until the sale is done, Yahoo’s users should not see any major changes in the company’s mobile apps or websites.
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That’s because AOL boss Tim Armstrong – who sold AOL to Verizon a year ago for $4.4 billion before engineering Verizon’s latest deal for Yahoo – has his own ideas for Yahoo, sources said.
However, the takeover, which is due to be completed in early 2017, raises questions about whether the Yahoo brand could disappear.
Yahoo first put itself up for sale in February and it fielded multiple bids from nearly 40 different types of buyers including AT&T; Quicken Loans founder Dan Gilbert with financial backing from Berkshire Hathaway CEO Warren Buffett; and private equity firms TPG and Vector Capital Management.
– Yahoo’s finances have been skewed by its stake in China’s Alibaba. They will be spun into a separate, yet-to-be-named, publicly traded company. These are not included in Yahoo’s deal with Verizon.
The sale puts an end to Yahoo’s 21-year history as an independent company.
The No. 1 U.S. wireless operator is betting that it can take data on more than 200 million unique monthly visitors to Yahoo sites, many of them on mobile devices, and combine it with data on 150 million or so unique monthly AOL users and data on its own user base of over 100 million wireless subscribers to offer a more targeted service for advertisers.
The deal is expected bring an end to Marissa Mayer’s four-year tenure at the helm of Yahoo. Where once it dominated the cybersphere, it has since been compared to a fallen star, as it struggled to keep up with rivals such as Google and Facebook. Apart from unease over rising US gasoline stocks during the peak summer driving season, investors are anxious over European banks: “Concerns about the Italian banking sector threaten to rear their ugly head again this week as all European banks undergo stress tests”, he said. “I love Yahoo, and I believe in all of you”. But on Monday, Walden said she expects AOL and Yahoo to break out of their combined single-digit market share.
While the situation indicates that until those roles are spelt out, Mayer still has a job, a new analysis by Equilar, an executive compensation research and consulting company, estimates a US$218.9 million (A$293 million) golden parachute for her. “The press has tried to make it a little more of drama camp, but we come from similar backgrounds”.
On a conference call with analysts after the announcement, Mayer repeated that line before adding, “A lot of the integration discussions are still ahead of us”. She touted Verizon’s potential to “accelerate our revenue stream in digital advertising” and repeatedly said she was “excited” for the future. The company says it acquired AOL past year to enhance its strategy of providing “a cross-screen connection for consumers, creators and advertisers”, and with Yahoo, Verizon will be “in a highly competitive position as a top global media company, and [Yahoo] will help accelerate our revenue stream in digital advertising”, Verizon’s chairman and CEO, Lowell McAdam, said in a statement announcing the acquisition.
Mayer, like Armstrong, previously worked at Google before taking over the top spot at Yahoo in 2012.
“Investors as of right now should really start thinking of themselves as only Alibaba if they own Yahoo”. Regardless of what happens, however, Mayer has made a boatload of money from Yahoo.
The winning bid of AUD$6.4bn is a shadow of what other businesses had previously offered for Yahoo during its boom, with Microsoft offering USD$44bn for the business in 2008.
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Verizon said it would provide more detail on the strategy behind the acquisition when it announces second-quarter earnings on Tuesday.
