Verizon has officially announced that it is buying Yahoo’s operating business for approximately $4.83 billion in cash. The wireless giant made the announcement Monday morning. The deal is expected to close in Q1 2017.
“Just over a year ago we acquired AOL to enhance our strategy of providing a cross-screen connection for consumers, creators and advertiser,” Verizon Chairman and CEO Lowell McAdam said in the release. “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.”
The search firm will be integrated with Verizon-owned AOL, with Verizon EVP and President of the Product Innovation and New Businesses organization Marni Walden leading the combined entity.
Yahoo CEO Marissa Mayer is expected to stick around for awhile at least. “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 wrote in an internal memo.
Verizon won’t take ownership of Yahoo’s stakes in Alibaba and Yahoo Japan, which are worth billions on their own. As of last Friday, Yahoo’s 15% of Alibaba represented $31.2 billion, and its 34% piece of Yahoo Japan was worth $8.3 billion. Yahoo will also hold onto its patent portfolio, which is worth around $1 billion. Verizon will take ownership of Yahoo’s Sunnyvale headquarters.
TechCrunch reports the pieces that remain following the acquisition will rebrand themselves and will become a separate, registered publicly traded investment business.
The deal is subject to the usual closing conditions, approval by shareholders, and regulatory approvals, and such. Until the closing, Yahoo will continue to operate independently.