On the 13th of June, telecommunications company Verizon finally completed its acquisition of the core internet business of multinational technology company yahoo. In conjunction with this, Yahoo CEO Marissa Mayer is stepping down from her post. Verizon's originally announced their plans to buy the core internet business last July, but the deal hit snags after it was disclosed that Yahoo had been affected by two data breaches in 2013 and 2014. These breaches affected over one billion user accounts.
The terms of the acquisition and what's next?
Verizon paid $4.48 billion dollars to take control of Yahoo's core internet business, which includes assets like Yahoo Finance and Sports.
Yahoo's data above breach helped saved Verizon about $350 million on their original offer. Verizon now plans on combining what it purchased from Yahoo with various other brands like AOL, TechCrucnh and the Huffington Post. These will all be combined into a new subsidiary company that will be called "Oath".
Oath will be home to over fifty different media and technology brands. It will be run by Tim Armstrong, who has been the Chief Executive Officer (CEO) of AOL since 2009. Armstrong spent almost a decade as the President of Google's American Operations and as their Senior Vice President before becoming AOL's CEO.
Mayer's golden parachute
Marissa Mayer, who had been CEO of Yahoo since July 2012 after leaving Google, is now expected to receive a significant "golden parachute" payment.
Filings with the Securities and Exchange Commission (SEC) show that it will be worth over $23 million. When Mayer arrived as CEO, it was hopefully believed by many that she could turn around the struggling company, but despite her efforts, there was never much sales growth.
What's next for Yahoo?
Their deal with Verizon ends Yahoo time as a stand-alone company.
It still holds about a 15% stake in Alibaba, a Chinese e-commerce company, as well as around a 36% stake in Yahoo Japan and a noncore portfolio of patents named Excalibur. It also still has cash, convertible notes, marketable debt securities and certain other minority investments.
All of these remaining parts of Yahoo are being renamed Altaba, with Yahoo board member Thomas McInerney as CEO.
Sources have also told CNBC about 2,100 jobs may be cut as Yahoo and AOL integrate, which would be around 15% of both companies' combined workforces. However, no official announcement of this happening has been made.
