Verizon Communications confirmed today that it will acquire Yahoo’s operating business for approximately $4.8 billion in cash.
“Just over a year ago we acquired AOL to enhance our strategy of providing a cross-screen connection for consumers, creators and advertisers. 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,” said Lowell McAdam, Verizon Chairman and CEO, in a statement.
Marissa Mayer, the CEO of Yahoo, is not expected to join Verizon. She would walk away with a severance payout worth about $57 million, according to Equilar, a compensation research firm.
“Yahoo is a company that has changed the world, and will continue to do so through this combination with Verizon and AOL. This transaction sets up a great opportunity for Yahoo to build further distribution and accelerate our work in mobile, video, native advertising and social,” she said.
Yahoo will be integrated with AOL, which has acquired and invested in media brands such as Huffington Post, TechCrunch, and Engadget.
“Yahoo has been a long-time investor in premium content and created some of the most beloved consumer brands in key categories like sports, news and finance,” said Tim Armstrong, CEO of AOL. “This transaction is about unleashing Yahoo’s full potential, building upon our collective synergies, and strengthening and accelerating that growth.”
The deal is subject to customary closing conditions, approval by Yahoo’s shareholders, and regulatory approvals, and is expected to close early next year. Until the closing, Yahoo will continue to operate independently.