Verizon Communications Inc and Yahoo! Inc. today announced they have entered into a definitive agreement under which Verizon will acquire Yahoo!’s operating business for approximately $4.83 billion in cash, subject to customary closing adjustments.
Yahoo! informs, connects and entertains a global audience of more than 1 billion monthly active users, including 600 million monthly active mobile users through its search, communications and digital content products. Yahoo! also connects advertisers with target audiences through a streamlined advertising technology stack that combines the power of their data, content and technology.
Lowell McAdam, Verizon Chairman and CEO, said: “Just over a year ago we acquired AOL to enhance our strategy of providing a cross-screen connection for consumers, creators and advertiser. The acquisition of Yahoo! will put Verizon in a highly competitive position as a top global mobile media company, and help accelerate our revenue stream in digital advertising.”
Marissa Mayer, CEO of Yahoo!, said: “Yahoo! is a company that has changed the world, and will continue to do so through this combination with Verizon and AOL. 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!,” Marissa Mayer said in the release. “This transaction also sets up a great opportunity for Yahoo! to build further distribution and accelerate our work in mobile, video, native advertising and social. Yahoo and AOL popularized the Internet, email, search and real-time media. It’s poetic to be joining forces with AOL and Verizon as we enter our next chapter focused on achieving scale on mobile. We have a terrific, loyal, experienced and quality team, and I couldn’t be prouder of our achievements to date, including building our new lines of business to $1.6 billion in GAAP revenue in 2015. I’m excited to extend our momentum through this transaction.”
Yahoo! will be integrated with AOL under Marni Walden, EVP and President of the Product Innovation and New Businesses organization at Verizon.
The addition of Yahoo! to Verizon and AOL will create one of the largest portfolios of owned and partnered global brands with extensive distribution capabilities. Combined, AOL and Yahoo will have more than 25 brands in its portfolio for continued investment and growth. Yahoo!’s key assets include market-leading premium content brands in major categories including finance, news and sports, as well as one of the most popular email services globally with approximately 225 million monthly active use. Additional technology assets in the advertising space include Brightroll, a programmatic demand-side platform; Flurry, an independent mobile apps analytics service; and Gemini, a native and search advertising solution.
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. Until the closing, Yahoo! will continue to operate independently, offering and improving its own products and services for users, advertisers, developers and partners.
Verizon will generally issue cash-settled Verizon RSUs for Yahoo RSUs that are outstanding at the close.
The sale does not include Yahoo’s cash, its shares in Alibaba Group Holdings, its shares in Yahoo! Japan, Yahoo!’s convertible notes, certain minority investments, and Yahoo!’s non-core patents (called the Excalibur portfolio). These assets will continue to be held by Yahoo!, which will change its name at closing and become a registered, publicly traded investment company. Yahoo! will provide additional information about the investment company at a future date.
Source: PR News Wire