Verizon agrees to buy Yahoo for $4.83 billion

verizon buy yahoo

July, 2016. This deal is inclusive of all content, search, online brands, mobile activities, and email service which has almost around 225 million users around the globe.

Moreover, Verizon will also acquire the Bright roll programmatic ad service along with other advertising services previously owned by Yahoo.

However, the deal excludes Yahoo’s stakes in Yahoo Japan and Alibaba. These entities alone are worth billions of dollars and will remain under Yahoo.

Although the names of these entities will be changed as soon as the deal closes given that the deal is subject to the approval of shareholders and regulators at the moment and is not confirmed yet. As anticipated by Verizon the deal should close by the beginning of 2017, after which Yahoo would not be operating independently.

Verizon Chairman and CEO, Lowell McAdam has also announced the company’s plans to integrate Yahoo with AOL, which was taken over by Verizon for $4.4 billion, last year to enhance its advertising business.

The intention behind this integration is not only to diversify the revenues earned by Verizon but also to formulate a larger advertising service reaching millions and billions of internet and mobile phone users.Thus, if this happens, Verizon will eventually be giving a real tough time to Facebook and Google, the two companies who currently dominate online advertising.
However, the acquisition of a company as huge as Yahoo comes with its own set of challenges, and if Verizon wishes to become the third major online advertising company, it will have to cope with these challenges.
What is important to note here is that the acquisition of Yahoo by Verizon not only marks an end to the glorious history of Yahoo as an independent company but also to the efforts put in by the CEO, Marissa Mayer because it is uncertain what will she be doing after the completion of the deal. She joined the company in 2012 with the promise to revive Yahoo like never before; however the leader of yahoo, post-acquisition, is still to be announced.
A spokesperson for Yahoo furthered the uncertainty by claiming that it is “too early to say” if Mayer stays on as CEO or shifts to Verizon, or even steps aside, while on the other hand Mayer is confident about her decision to stay with Yahoo and witness its transition. As she writes; “For me personally, I’m planning to stay. I love Yahoo, and I believe in all of you. It’s important to me to see Yahoo into its next chapter.”

Mayer also wrote a letter, which was posted on Tumblr, to address her employees and praise them for what they have accomplished over the years as a team.

Quoting her, “I’m incredibly proud of everything that we’ve achieved, and I’m incredibly proud of our team.” It can also be interpreted from the letter that she is also very confident about this deal with Verizon because it will help Yahoo achieve a higher scale, and boost its business, opening the doors to more opportunities.