Yahoo’s future may be decided on Monday following reports that the
company will be acquired by Verizon Communications in a $4.8 billion
deal.
Reported by Bloomberg citing a source with direct knowledge, the
agreement is said to be announced before the markets open and will
drastically change the course of Yahoo’s future, one that has been
wrought with failed turnaround attempts by multiple leaders. Verizon was
said to have won the bid amid a battle among numerous competitors
including private equity firm TPG, a group led by Quicken Loans’ Dan
Gilbert, and even AT&T.
Paying $4.8 billion for Yahoo is slightly more than what Verizon paid
for AOL a year ago and the relationship is aimed at strengthening the
telecommunication company’s advertising and content offerings. Yahoo’s
Brightroll technology will likely be one of the focal points of this
deal as well as perhaps elements from the company’s Maven’s product.
Final proposals by bidders interested in Yahoo were scheduled to be
submitted last week. During the company’s earnings call, chief executive
Marissa Mayer declined to announce a deal, instead saying the board
intends to “deliver shareholder value with this process.” Additionally,
the “independent strategic review committee continues to manage this
effort and we’re making great process.”
Will this signal the end for Mayer’s tenure as CEO? Reports suggest that
she’s on her way out and shareholders even expressed their disapproval
at Yahoo’s last annual meeting. But should she walk away, it’s estimated
that she’ll take with her a $55 million severance package.
Yahoo first opened up bids on itself in February as part of an
“aggressive strategic plan” put forth by the board amid fighting by
activist shareholders. While Mayer’s team implemented cost cutting
measures, including laying off 15 percent of its workforce, it was all
done to make itself leaner and more appealing to potential suitors.
Verizon had always been considered a front-runner for the move, even
utilizing AOL CEO Tim Armstrong to woo the company.
But while Verizon would own Yahoo, it would only be its core business.
Whoever is left in charge at the company will be the caretaker of a 35.5
percent stake in Yahoo Japan and a 15 percent holding in Alibaba.
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