Verizon Communications Inc. (NYSE:VZ) has confirmed $4.83 billion buyout of online pioneer Yahoo (NASDAQ: YHOO), marking end of an era for company that once defined the internet.
The telecoms giant has been the leading candidate in Yahoo’s four-month sale process. By pairing Yahoo with AOL, Inc. (NYSE:AOL), which Verizon bought in May 2015 for $4.4 billion, Verizon’s resulting Net media unit could represent a more competitive option for digital advertisers after Google and Facebook.
Verizon CEO Lowell McAdam said:
Just over a year ago we acquired AOL to enhance our strategy of providing a cross-screen connection for consumers, creators and advertisers. 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.”
Verizon’s acquisition includes Yahoo’s operating business — advertising technology and popular online content such as Yahoo Sports, Yahoo Finance and Tumblr — as well as the Yahoo brand and real estate attached to the core business including Yahoo’s Sunnyvale, Calif. headquarters.
That leaves Yahoo with its 15% stake in Chinese retailing giant Alibaba (BABA), worth $32 billion, and its 36% stake in Yahoo Japan, worth about $8 billion. When the transaction is closed — expected to happen in the first quarter of 2017 — Yahoo will change its name and become a publicly traded investment company, the company said.