American telecommunications giant Verizon Communications announced on Monday that it is acquiring the core internet properties of Yahoo for $4.83 billion in cash. This new acquisition is set to expand Verizon's digital advertising and media business.
Many tech and market analysts agree that Verizon's acquisitions of Yahoo's properties will boost the company's internet business. The acquisition will also give Verizon access to Yahoo's advertising technology tools like Flurry and BrightRoll. Included in the deal are Yahoo's search, email, and messenger business as well.
In a statement acquired by South China Morning Post, Yahoo chief executive officer Marissa Mayer said, "The sale of our operating business, which effectively separates our Asian asset equity stakes, is an important step in our plan to unlock shareholder value for Yahoo."
The deal between Verizon and Yahoo is expected to be closed within the first few months of 2017. The acquisition will also mark the end of Yahoo as an operating company. The once dominant Internet empire is left with 15 percent stake in Chinese e-commerce giant Alibaba Group Holding and 35.5 percent interest in Yahoo Japan.
Mayer added that Yahoo will continue to operate as an independent company until the deal with Verizon is approved by both regulatory commissions and shareholders. According to BBC, Mayer said that she is planning to stay at Yahoo. On the other hand, Verizon executive vice president Marni Walden said that a new leadership team that will head the two combined companies is still being formed.
Verizon's acquisition of Yahoo's core Internet properties does not include the latter's cash, its stake in Alibaba, as well as its shares in Yahoo Japan. The company's Alibaba and Yahoo Japan investments are currently valued at around $40 billion. On the other hand, Yahoo has a market value of about $37 billion.
Several major investment groups have showed interests in acquiring Yahoo's assets. Among these companies are AT&T, TPG Capital LP, and a consortium between Sycamore Partners and Vector Capital.
