Yahoo will operate independently until the acquisition and then fall under the aegis of AOL unit chief, Tim Armstrong, a former Google colleague of Mayer.
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However, the clue for the future of Yahoo, founded in 1995 by Jerry Yang and David Filo, two computer graduate students at Stanford University on the US west coast, was in a news release from Verizon, headquartered in New York City on the east coast. The company will now only continue to reach even more consumers with Yahoo’s services.
Yahoo will be integrated with AOL under Marni Walden, EVP and President of the Product Innovation and New Businesses organization at Verizon.
“Google and Facebook are doing such a good job executing”, said Armstrong, who helped lead Verizon’s successful bid for Yahoo. The company spent more than $US3 billion buying or investing in more than 51 companies ranging from Flurry, an advertising platform for mobile applications to Tomfoolery, a smartphone applications developer.
Walden said Verizon had not yet made a decision about what role if any Mayer would have after the deal closes.
Mayer will receive a severance package worth about $57 million, bringing her total cash and stock compensation during her time at Yahoo to around $218 million.
But Verizon appeared to be the leading candidate because of its ability to integrate AOL’s advertising technology into Yahoo services.
So if the theory of the shareholder suit holds up, all of Yahoo’s significant business commitments are void – including the Verizon deal, said plaintiffs’ lawyer Richard Stone of Kirby McInerney in an interview Monday.
The dog days of summer tech news are upon us, so we have only two ExtraBITS for you this week: Verizon is buying Yahoo for $4.8 billion and Adam Engst makes an appearance on MacBreak Weekly. It was these assets that drove much of Yahoo’s profitability in recent years, analysts noted.
Yahoo will be left with its stakes in Alibaba Group Holding Ltd and Yahoo Japan Corp, with a combined market value of about $40 billion.
July: Verizon acquires Yahoo’s core business. “It’s important for me to see Yahoo into its next chapter”, quotes Sydney Morning Herald. Both were executives at Google for years and Armstrong tried unsuccessfully to convince Mayer to combine the two companies when they remained independent.
Together AOL and Yahoo would have more than 25 brands, including Yahoo Mail, Flickr and Tumblr as well as AOL’s Huffington Post and Techcrunch news sites.
The deal is subject to customary closing conditions, approval by Yahoo’s shareholders, and regulatory approvals, and is expected to close in Q1 of 2017.
While Yahoo has been successful in building a global audience of as many as one billion worldwide, “it hasn’t been able to change and adjust its brand as the market has changed”, VanBoskirk told AFP.
“Yahoo is a company that changed the world and will continue to do so”, she said during a Monday conference call with analysts.
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Australia’s top-rating free-to-air television network Seven West Media, which has an online joint venture with Yahoo, said it will consider “various options” if its 50:50 digital partner gets sold. Shares of Yahoo were down almost 4% Monday afternoon.
