Yahoo is Verizon’s second big acquisition following AOL’s buyout for $4.4 billion a year ago.
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Another sharp fall in oil prices pulled down energy stocks on Wall Street Monday, pushing the main United States indices to a loss after last week’s record highs. The company said it will return cash to shareholders and update investors on plans for the other assets later.
The slump has been deepening even though advertisers have been pouring more money into what is now a $160 billion market for digital advertising, according to research firm eMarketer.
Yahoo itself hinted on Monday it prefers to deal with Yahoo Japan first, rather than Alibaba.
Mayer added, “Yahoo and AOL popularized the Internet, email, search and real-time media”.
In a later interview with The Associated Press, she said it’s too early to know whether there will still be a desirable role for her after Yahoo and AOL are combined.
“It would be premature and presumptive of me to discuss what Verizon may or may not want to do. I will be open-minded”, said Mayer, who could receive a severance package valued at $55 million If she leaves following the sale.
But despite the media unit’s rocky ride, Verizon is going to inherit some potent web properties in branded verticals for sports and finance, as well as a roster of brand-name journalists like Couric and tech guru David Pogue.
Although analysts Peck and Doshi said the $4.83 billion sale price was reasonable, that figure is lower than what shareholders hoped for, said activist investor Eric Jackson of SpringOwl Asset Management. “If you are Yahoo Mail user, you will see a lot more Yahoo not a lot less Yahoo in the future”. The call will be hosted by Yahoo CEO Marissa Mayer and Yahoo CFO Ken Goldman. “They’re third place in a two-player market”. “But better late than never”. The software giant offered more than $45 billion for Yahoo, but then-CEO Yang eventually rebuffed the deal as too cheap.
The deal does not include Yahoo’s valuable stake in Chinese firm Alibaba.
“Yahoo is a company that has changed the world, and will continue to do so through this combination with Verizon and AOL”, she said.
As the web expanded to become a central way people communicate and do business in the new century, traversing its breadth became more hard, and Yahoo sought to fold in more products and features.
“I think Yahoo becomes a sub-brand just like AOL has”, Giusto said.
Verizon, based in Basking Ridge, New Jersey, is buying Yahoo’s online operations and its real estate. Following the Verizon deal’s closing and a patent sale, the company’s net cash balance should be north of $10 billion to $11 billion, or $10.50 to $11.55 per share.
Her fate, and that of all Yahoo’s content assets will be decided AOL CEO Tim Armstrong, who will bring Yahoo into his portfolio. Because of redundancies between the Yahoo and Verizon work forces, layoffs at Yahoo are likely, perhaps hitting up to one in five workers, Gold said.
Speaking on CNBC, Walden said she and Armstrong planned to meet with Mayer.
US government bond prices didn’t move much.
“It’s another reason why the market looks tired at the moment”, he said. “The next chapter is around how we can increase our relevance on mobile”. Yahoo and Yahoo Japan did not offer any comment on Monday.
As of April, when investors filed their amended complaint, 90 percent of Yahoo’s assets and all of its income were from the company’s investments in Yahoo Japan and Alibaba, in which Yahoo took a stake in 2005.
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When millions of people began to flock to the internet with the advent of graphical web browsers in the 1990s, Yahoo was king. It also proved internet companies could be profitable as other dot-com startups burned through millions of dollars. The demise of this once popular internet portal was caused by its failure come up with a better search engine than Google.
