Yahoo has plans of reorganizing its core business cutting its workforce number and concentrating on fewer products such as Yahoo Mail and Tumblr. Due to decrease in sales and shares, the Board of Directors considers selling the Internet company to potential buyers like Verizon. Verizon CEO shows his interest for a possible buy-out deal.
Simultaneously, the company gets stressed from activists shareholders to think of other choices to bring back the company's value. As of the moment, the company has a market value of $27.4 billion, which is down from $42.4 billion a year ago, according to USA TODAY.
The company mentioned that it is a part of their "strategic alternatives" to regenerate their operation. The move on cost-cutting is somehow the first stage that will cease the company from selling its core web business.
Yahoo CEO Marissa Mayer states that she believes the company's mobile search function will further enhance. However, the week's earnings gave the Yahoo board the signal to consider the selling of the internet company, Benzinga reports.
Many qualified buyers are on Yahoo's list. Such big firms that show interest include big media and communication companies like Verizon, AT&T, Comcast, and Alibaba to name a few. As per the RBC Capital Market's note, the list of Yahoo's buyer will get longer if Yahoo decides to separate its core business in few numbers. In such case it will become smaller and the deal size would be reduced.
"Given our base case does not value any individual display asset over $700M, a much wider range of companies can be bidders for YAHOO's individual properties," RBC's note said.
So far, Verizon has remained quiet despite its CEO's keen interest of having a buy-out deal with Yahoo. Verizon CEO Lowell McAdam quoted at a conference, "it turned out that parts of it, or all of it were for sale, we'd look at it like anything in the digital media area at this point, because it's so hot.", as reported by South China Morning Post.
Although a lot of giant companies show interest in acquiring Yahoo, Verizon tops the list as one of the potential buyers. On Wednesday, Yahoo shares dropped 4.75% to $27.68. Its stock has fallen 36% over the past year. Yahoo's core business can be sold from $4 billion to $8 billion as determined by the buyer.
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