Verizon buys Yahoo for $4.83bn

Verizon is buying Yahoo for $4.83 billion, marking the end of an era for a company that once defined the Internet.

It is the second time in as many years that Verizon, extending its digital reach, has snapped up the remnants of a fallen Internet star. The nation's largest wireless carrier paid $4.4 billion for AOL last year.
Yahoo will be rolled into Verizon's AOL operations and CEO Marissa Mayer may be reunited with AOL CEO Tim Armstrong. Both were executives at Google for years and Armstrong tried unsuccessfully to convince Mayer to combine the two companies when they remained independent.
"We have enormous respect for what Yahoo has accomplished: This transaction is about unleashing Yahoo's full potential," Armstrong said in a printed statement.
Most analysts expect the deal to end the four-year reign of Yahoo's Mayer, who flopped in her attempts to turn around Yahoo.
Mayer, though, told employees in a Monday email that she intends to stay without specifying for how long. "I love Yahoo, and I believe in all of you. It's important to me to see Yahoo into its next chapter," she wrote.
Yahoo Inc., based in Sunnyvale, California, is parting with its email service and still-popular websites devoted to news, finance and sports in addition to its advertising tools under pressure from shareholders fed up with a steep downturn in the company's revenue during the past eight years.
The slump deepened even as advertisers pour torrents of cash into what is now a $160 billion market for digital advertising, according to research firm eMarketer.
Most of that money, however, has been flowing toward Google and Facebook, two companies that eclipsed Yahoo during its slide from an online sensation, once valued at $130 billion, to a dysfunctional also ran.
After the sale is completed early next year, Yahoo will become a holding company for its two stakes in China's e-commerce leader, Alibaba Group, and Yahoo Japan. Those investments, made more than a decade ago, are worth more than $40 billion before taxes, making them by far the most valuable pieces of Yahoo. The holding company will drop the Yahoo name and adopt a new identify after Verizon takes control of the operating business.
Yahoo also still has a patent portfolio that it intends to sell, and about $7.7 billion in cash. Verizon is buying Yahoo's real estate, along with the online operations.
Yahoo has hired a succession of CEOs to engineer a comeback, but finally gave up after the high hopes that accompanied Mayer's arrival fizzled out.
The sale could potentially result in thousands of layoffs. Mayer has already jettisoned 1,900 Yahoo workers since last September. If Mayer leaves following the sale, she will be in line to receive a severance package valued at $55 million.
When millions of people began to flock to the internet with the advent of graphical web browsers in the 1990s, Yahoo was king. Co-founders Jerry Yang and David Filo began building a web directory as Stanford University computer graduate students in 1994, and Yahoo quickly established itself as the online hub for tens of millions of people.

Source: Arab News