Verizon Communication has acquired Yahoo, one of the largest internet firms in the US.
Verizon Communications Buys Yahoo in a $5bn Cash Deal
Yahoo will now be combined with AOL, which Verizon purchased last year.The buyoff does not however comprise of Yahoo’s stake in Chinese ecommerce giant, Alibaba.
Verizon has bought the internet giant for $5bn, a sum that is way below the $44bn offered by Microsoft in 2008. It is also drastically lower than the $125bn Yahoo was worth at the peak of the dot.com boom.
In a statement, Verizon said that it would transform Yahoo into an international media firm. Yahoo currently has over one billion monthly active users.
Following the buyoff, chief executive of Yahoo Marissa Mayer said, “Yahoo has changed the world and it will continue to do so through its merger with AOL and Verizon.”
Getting into next chapter
Ms. Mayer wrote an email to staff letting them know that she was looking to continue to head the company. She said, ‘I love Yahoo and I believe in every one of you. It is important to me to see the company transition into the next chapter.”
Yahoo’s takeover by Verizon is set to be complete by the early months of 2017. However, many have questioned the fate of the Yahoo brand altogether.
Michael Goodman, a Strategy Analytics director pointed out, “That is the big question. What is going to happen to the brands?”
According Tim Armstrong, AOL chief executive, the deal was intended to transform Yahoo into a major player in the mobile media space and to bring out the company’s full potential.
Combined, Yahoo and OAL will have over 25 brands, including Techcrunch, Huffington Post, Tumblr, Yahoo Mail and Flickr.
Ms. Mayer took over as Yahoo’s top executive but she has not made any significant progress in bringing back Yahoo to profitability.
Last week, the internet company reported a $440m loss in its second quarter although Ms. Mayer asserted that the board had made significant progress on “strategic alternatives.”