Verizon announced on Monday that it will be acquiring some assets of Yahoo for disclosed sum "fee" of $4.83 Billion Dollars in cash subject to however to customary closing adjustments and the approvals of Yahoo's shareholders and the necessary regulators such as the Security and Exchange Commission. As such, the deal is not expected to be completed until the first quarter of 2017 financial year.
The deal involves the acquisition of Yahoo's core internet businesses but may not include its portfolio investments in Alibaba and Yahoo Japan which collectively are worth more $31 Billion Dollars of their own and the patented Yahoo Cash. However in an apparent restructure, included in the acquisition package include Yahoo's premium email platform which has over 230 million subscribers and still growing, Yahoo's search services, the Tumblr network, the flagship signature headquarters of Yahoo at Sunnyvale, and of course the brand-name Yahoo.
The cherry-picking is a step towards the telecommunication company's foray into the digital advertising and media businesses and possibly challenge the dominance of Google, and potentially Facebook, in the sector. Just last year, Verizon acquired AOL for $4.4 billion dollars, signaling the telecom company interest to reap from the high-revenue yielding digital marketing which since the social media revolution of the early 2000's (2000-2010) has overtaken other forms of advertising in revenue yielding.
Once the acquisition is completed, it is expected that the operations of Yahoo and AOL would be merged to refocus the merged portfolios for a potential revenue-spinning collaboration.
In an email, the current CEO of Yahoo described the company as one "that has changed the world," while she remained optimistic that the combination of AOL and Yahoo would "continue to do".
According to the amazon behind Yahoo's turnaround since 2002, "it's poetic to be joining forces with AOL and Verizon as we [Yahoo] enter our next chapter focused on achieving scale on mobile. We have 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."
AOL CEO, Tim Armstrong, has also spoken highly of the acquisition. "Combining Verizon, AOL and Yahoo will create a new, powerful competitive rival in mobile media, and an open, scaled alternative offering for advertisers and publishers," Tim Armstrong states.
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