US telecoms company Verizon has put months of speculation to rest announcing that it will secure Yahoo’s core internet business for $4.8bn.
Yahoo will be integrated with AOL under Marni Walden, executive vice president and president of the product innovation and new businesses at Verizon. The deal is subject to regulatory approval, expected by the first quarter of 2017.
Yahoo retains only a 35.5 percent stake in Yahoo Japan and less than a fifth of Chinese ecommerce company Alibaba.
Verizon seems intent on buying up 90’s web giants having secured AOL last year for $4.4bn, which will now be bolstered by Yahoo’s business.
Yahoo chief executive Marisa Mayer is set to receive a $54.9m severance payment from the move.
On the deal she 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. 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.”
Lowell McAdam, Verizon chairman and chief, 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.”
"Yahoo and AOL popularised 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."
Tim Armstrong, chief of AOL said that the Yahoo merger will help the company build premium content in "key categories like sports, news and finance", with AOL currently running media outlets including The Huffington Post, TechCrunch and Engadget. They boast a combined total of 25 brands.
Five bidders were reportedly involved in the final round of offers.