In January, when Yahoo announced plans to spin off its $31 billion stake in Chinese e-commerce giant Alibaba, there was talk of how it would liberate Yahoo to focus on its core business. The shares in Alibaba remain Yahoo’s most lucrative asset, with the company’s $8.5 billion stake in Yahoo Japan a distant second.
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“We certainly do appreciate simplicity”, she said. She has also tried to make the company a premier media destination, hiring well-known personalities like journalist Katie Couric, and acquiring the rights to high-profile shows like the sitcom “Community”.
Investor’s didn’t cheer the move.
But with Yahoo stock trading at about $35 a share, he downgraded the stock Wednesday, noting that there was little upside for investors given the risks.
Yahoo is now pursuing a different course that could make it easier to eventually sell its Internet operations, the business that now generates virtually all of Yahoo’s revenue.
According to Andrew Frank, an analyst at research firm Gartner, Yahoo is essentially back where it was a year ago, talking about a spinoff and trying to define the identity and value of its core business.
A Yahoo spokeswoman declined to comment further.
Yahoo suggested it wasn’t entirely swayed by Starboard.
“I think what Yahoo did was positive”, Peck said. “But we have so much more insight from our advisers” who have intimate knowledge of the complexities of the business.
Despite this, Yahoo.com is still the fifth most visited website in the world. Others have said it could be worth less than $2 billion. The revised plan calls for the Yahoo Japan holdings to move into the new company that will house its Internet operations.
So it’s probably not a coincidence that executives at the largest USA wireless carrier were chattier than usual this week when asked the question: Would Verizon be interested in buying Yahoo’s Internet assets?
Yahoo might be in deep financial trouble, but it might not be so desperate yet so as to divest itself of what remains of its core businesses and assets. This coincides with his recent purchase of AOL for $4.4 billion in May of this year.
The analyst sees this as being the worst-case scenario because he’s assuming that the reverse spin still gets a tax-free structure.
“So we want to help her return this great company to an iconic place where it belongs”, Webb said.
Webb told CNBC that the board has a “fiduciary obligation to engage with any legal person that comes forward with a good offer”, but that Yahoo is not “proactively trying to do any of that”.
The reverse spin off will be subject to third party consents, preparation of audited financial statements, shareholder approval, and SEC filings and clearance, including under the Investment Company Act of 1940. The company said the transaction could take a year or more.
Yahoo CEO Marissa Mayer personally recruited Nelson, and waited for Nelson’s non-compete to expire after she left Time Inc in 2013, according to Politico. That’s the story from Comcast’s CEO, who says those who use the most, should pay the most.
Yahoo has struggled to grow its Internet business, which includes selling search and display ads on its news and sports sites and email service, in the face of competition from Alphabet Inc’s Google and Facebook Inc.
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Instead, Yahoo will take all of its assets and liabilities other than Alibaba and transfer them to a newly formed company. The board has no plans to replace him and will shrink to eight members.
