In an email to employees, she wrote that “I’m planning to stay…” Yahoo hired Mayer, a former Google (GOOGL.O) executive, as CEO in 2012 with a mandate to engineer a turnaround, but her strategy to focus on mobile, video and social content could not revive the company and reverse its sagging stock price. “I will be open-minded”, said Mayer, who could receive a severance package valued at $55 million If she leaves following the sale. The Internet pioneer’s services draw about one billion visitors each month.
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After a few days full of rampant speculation, Verizon finally confirmed yesterday night that it had reached an agreement to purchase Yahoo’s core business for $US4.8 billion ($6.4 billion).
In addition, Yahoo user data can be combined with insights from Verizon’s mobile, internet and cable customers.
That’s because AOL boss Tim Armstrong – who sold AOL to Verizon past year for $4.4 billion before engineering Verizon’s latest deal for Yahoo – has his own ideas for Yahoo, sources said.
Verizon Communications Inc will announce an agreement on Monday to buy Yahoo Inc for about $5 billion, according to a person familiar with the matter.
Marissa Mayer, CEO of Yahoo, said in a statement: “Yahoo is a company that has changed the world, and will continue to do so through this combination with Verizon and AOL”.
“The Yahoo brand still holds a lot of consumer-affinity” and could help Verizon overcome the lukewarm feelings that many subscribers have toward their wireless service providers, said Forrester Research analyst Shar VanBoskirk.
But most of that money has flowed to Google and Facebook, two companies that eclipsed Yahoo during its long slide from a sensation to a dysfunctional also-ran.
But Verizon appeared to be the leading candidate because of its ability to integrate AOL’s advertising technology into Yahoo services.
It’s unclear what Mayer will do after the deal closes.
With the sale of its core, Yahoo will be left as a separate investment company and change its name after the transaction. She invested heavily in improving Yahoo’s mobile products, expanding its audience through the acquisition of Tumblr and doubling down on premium media content. She brought in TV journalist Katie Couric as Yahoo’s “global anchor”.
“I think Yahoo becomes a sub-brand just like AOL has”, Giusto said. After co-founders Jerry Yang and David Filo began building a web directory as Stanford University computer graduate students in 1994, Yahoo quickly established itself as the online hub for tens of millions of people. The company is said to have had an estimated worth of 5 billion during the dot.com boom.
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.
Also last week, Yahoo reported quarterly earnings that slightly missed analysts’ expectations, and revenue that beat projections – in part due to what Mayer called “disciplined expense management”.
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Nevertheless, don’t expect Mayer to be chilling in the cozy corner office past her expiration date, insiders said.
