Yahoo and AOL continue to change hands.
Verizon, which bought AOL in 2015 and Yahoo in 2017, is now selling them to venture capital firm Apollo Global Management for $5 billion.
Verizon amalgamated AOL and Yahoo into a subsidiary called Serment in 2017, finally rebranding into Verizon Media. The new company, where Verizon will retain a 10 percent stake, will be renamed simply “Yahoo.”
Verizon first acquired AOL for $4.4 billion and Yahoo for $4.5 billion, which makes it pretty bad business overall for Verizon. However, Verizon Media fared well in 2020 with strong revenue growth continuing into 2021.
Verizon Media has done amazing work around the company over the last two and a half years and the growth potential is huge. As part of the strategic review process, Apollo presented the most robust vision and strategy for the next phase of Verizon Media. I am fully confident that Yahoo will take off in his new home,” Verizon CEO Hans Vestberg said in a press release.
For the past two years, Verizon Media has been headed by Guru Gorwappan, and will continue to run the newly formed company.
If Verizon Media has been doing such a great job lately, why is Verizon selling it now? The answer is probably that Verizon is not all that the point of having a media company anymore. It was quite evident that Verizon was already selling its media properties, including Tumblr and Huffpost, in the past two years.
According to the Wall Street Journal, which reported on the possible takeover last week, Verizon has recently been focused on partnering with streaming video services such as Disney+ and Hulu. The agreement also allows the company to raise the liquidity it requires to continue to expand its core business. This includes billions of dollars in expenses for 5G spectrum licences as well as network equipment.
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