The telecom giant is paying $4.8 billion in cash for the core Internet assets and advertising technology of the beleaguered Internet pioneer. Fred Katayama reports.
The winner of Yahoo's lengthy auction: Verizon. The telecom giant beat out several private equity firms to notch a $4.8 billion cash deal for the core web assets of the beleaguered Internet pioneer. Verizon will get Yahoo's web content such as its email, finance and sports sites and its advertising technology. The deal unites Yahoo with its archrival, AOL, which Verizon had bought last year at a similar price. Analysts say Verizon wants to marry the data it has on its wireless subscribers with Yahoo's ad platform to better take on the likes of Facebook and Google. Yahoo, once a stronghold as an Internet portal, fell behind in social media, search, and mobile. Shares of Verizon and Yahoo fell in early trading. FBN Securities analyst Shebly Seyrafi said, "Verizon could continue to be a serial acquirer which could then spur bidding wars for other Internet properties." Yahoo will remain an independent company, retaining non-core patents and valuable stakes in Chinese e-commerce giant Alibaba and Yahoo Japan. Those latter stakes are worth more than Yahoo's market valuation. Marissa Mayer, who failed to turn around Yahoo as its CEO, said she plans to stay at the remaining investment company, but the Verizon executive who'll integrate Yahoo with AOL told CNBC the new leadership lineup hasn't been determined.