Verizon said the deal will create a combined company with one billion users and more than 25 brands which will be primed for “continued investment and growth”.
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The sale marks the second time in two years that Verizon has snapped up the remains of a fallen Internet star as it broadens its digital reach.
Verizon announced that it will acquire Yahoo’s operating business for about United States dollars 4.83 billion in cash.
Even with AOL and Yahoo, Verizon would still be far behind s Google and Facebook. “It’s important to me to see Yahoo into its next chapter”, she said in a letter to the employees.
“It would be premature and presumptive of me to discuss what Verizon may or may not want to do”. According to documents filed with regulators this year, Mayer would get a severance package of $55 million if removed within a year of a change of control.
“For me personally, I am planning to stay”. Now it will add Yahoo’s consumer services – search, news, finance, sports, video, email and the Tumblr social network – to a portfolio that includes AOL as well as popular sites like The Huffington Post.
According to eMarketer, Yahoo is expected to generate $2.32 billion in net USA digital ad sales, while AOL is expected to make $1.3 billion in 2016. They are two of several companies that have eclipsed Yahoo, who slid from an online sensation once valued at $130 billion to a dysfunctional also-ran.
Look to what Verizon did with AOL as guidance. Mayer has already jettisoned 1,900 Yahoo workers since last September. That task will land on Tim Armstrong, a former Google executive who joined Verizon after selling AOL. “But better late than never”.
“Seven West Media will have an opportunity, in the period between being formally notified of a transaction and final completion, to consider which options it selects or a combination as may be negotiated with the new owners of Yahoo, Inc that creates the most value for Seven West Media shareholders”.
When Yahoo Inc. officially becomes a part of Verizon Communications Inc., as is expected after their deal announced Monday morning, it will leave behind a “company” with no workers and no product.
With AOL and Yahoo, Verizon would still be far behind internet juggernauts Google and Facebook (FB.O). For instance, Yahoo shuttered Yahoo Health, Yahoo Real Estate and five others in February. Yahoo will also retain its cash, convertible notes, certain minority investments, and a noncore portfolio of patents called Excalibur.
Yahoo has hired a succession of CEOs to engineer a comeback, but finally gave up after the high hopes that accompanied Mayer’s hiring fizzled out. Yahoo has under 3.5 percent of market share and AOL has even less. While Mayer’s future at the company still has yet to shake out publicly, it’s not unreasonable to believe she’ll lose some, if not all, of her current grip on power. By early afternoon, Yahoo was down 2.7 per cent.
Yahoo executives said the remaining company is structured to “indefinitely” hold its Yahoo Japan and Alibaba shares.
As people began to flock to the internet with the advent of graphical web browsers in the 1990s, Yahoo was king.
The company was founded in 1994 by two Stanford University students, Jerry Yang and David Filo, as “Jerry and David’s Guide to the World Wide Web”. The company is said to have had an estimated worth of 5 billion during the dot.com boom.
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Yahoo is among the stodgier internet brands, but comScore says the age breakdown of Yahoo users in the U.S.is not substantially different than Google or Facebook users. To make matters worse, Yahoo failed to recognize the importance of social networking and was slow to make the leap into mobile devices such as smartphones and tablets.
