Yahoo Inc. CEO Marissa Mayer plans to leave the company’s board after the sale of its core business to Verizon is completed, during which time what's left of Yahoo will rebrand as Altaba.
Mayer joins co-founder David Filo and four other directors, who are stepping down from the new company as shareholders in Alibaba Group Holding Inc. and Yahoo Japan.
After Verizon takes over its online portals and mobile apps, Yahoo will be left with its 36% stake in Yahoo Japan and a 16% stake in Alibaba. It will then change its name to Altaba Inc. and reduce its board to five members as part of the deal, according to a filing with the Federal Securities Commission on Monday.
This will complete a long stretch in which Yahoo found itself trying to sell, before finding a buyer and then admitting to two major hacking incidents. Mayer had recently stated she was “heartened” by users’ loyalty after the first hack.
Verizon agreed to buy Yahoo’s web properties in a deal valued at $4.8bn, and there was speculation that Verizon was getting antsy after the hacks were discovered. The sale now seems to have shut the door on Mayer’s sometimes rocky tenure at the tech search company, which began in 2012.
"With the nearing end of the Marissa Mayer era – it looks like her plan is to complete the sale of the operating company to Yahoo and let the lawyers and tax accountants figure out the best option for the stakes in Alibaba and Yahoo Japan,” said Paul Sweeney, an analyst at Bloomberg Intelligence.
Some directors will remain after the company is sold to Verizon and becomes Altaba – Tor Braham, Eric Brandt, Catherine Friedman, Thomas McInerney and Jeffrey Smith. Brandt was named chairman on Monday to help the company ease its transition to an investment vehicle.
Maynard Webb, who had been chairman, intended to leave after the planned sale of the web services to Verizon and was named chairman emeritus.
Board members departing after the sale to Verizon said that “his or her intention to resign is not due to any disagreement with the company,” Yahoo said in the filing.
Although the statement did not make any definitive comment on Mayer’s role as CEO after the closure of the deal, the exit of Mayer from its board indicates her likely exit post closure of the sale – a move that would draw a line under a four-and-half year tenure at Yahoo's helm.
This is a period that saw her make several high-profile purchases including the $1bn purchase of photo-sharing service Tumblr, as well as the $640m purchase of BrightRoll in 2013 and 2014 respectively, among others, moves that resulted in varying degrees of success.
Industry observers expect Yahoo’s sale to Verizon, which does not include Yahoo’s cash, shares in Alibaba as well as Yahoo Japan, to close later this quarter. Following the closure of the deal with Yahoo, Altaba (as it will then be known) will register and be regulated as an investment company under rules stipulated in the US Investment Company Act, 1940, although it remains to be seen what kind of an offering a Verizon-owned Yahoo will pose to advertisers.
Speaking with The Drum at last week’s Consumer Electronics Show (CES), Lisa Utzschneider, Yahoo chief revenue officer, claimed that advertisers she was meeting with were inquiring over what a “post-deal Yahoo” would have to offer them, and also explained how it also intended to distinguish its adtech offering BrightRoll from the existing market leaders.
Elsewhere, speaking with The Drum at Dmexco last year, AOL CEO Tim Armstrong gave an insight into how a combined AOL/Verizon/Yahoo entity may shake things up in the online advertising market (see video below).
Additional reporting and analysis by Ronan Shields