Search engine giant Yahoo on Monday (January 9) announced that the company is in the final stages of a merger with American telecom giant Verizon.
Verizon initiated the acquisition of Yahoo's core internet business in July 2016 for a payout of $4.8 billion and is expected to get it completed before the end of first quarter of 2017.
However, there is also a possibility of Verizon renegotiating for a rebate in the Stock Purchase Agreement because of a cyber attack incident a few months ago, which compromised personal details of more than a billion Yahoo mail users.
Once the process is finished, Verizon is expected to merge Yahoo-branded web portal, search engine, email service, news services including the popular Yahoo Finance and Sports with AOL, the media company it acquired in 2015 for $4.83 billion.
The remaining Yahoo entity, which owns 15 per cent stake in Chinese e-commerce behemoth Alibaba and a 35.5 per cent stake in Yahoo Japan, which is jointly owned by Softbank, will run as a separate company under the new moniker 'Altaba'. Besides, five key members of board of directors including the company's chief executive officer (CEO), Marrisa Mayer, have decided step down.
"In light of the fact that following the Closing, the Company will operate as an investment company under the Investment Company Act of 1940, the Board has determined that, immediately following the Closing, the size of the Board will be reduced to five (5) directors. Tor Braham, Eric Brandt, Catherine Friedman, Thomas McInerney and Jeffrey Smith will continue to serve as directors of the Company following the Closing, and Mr. Brandt will serve as Chairman of the Board. Each of David Filo, Eddy Hartenstein, Richard Hill, Marissa Mayer, Jane Shaw and Maynard Webb has indicated that he or she intends to resign from the Board effective upon the Closing, and that his or her intention to resign is not due to any disagreement with the Company on any matter relating to the Company's operations, policies or practices," Yahoo Inc. said in its filing on United States Securities and Exchange Commission.
As of now, there is no official word on whether Marissa Mayer will continue as Yahoo CEO.
Watch this space for more updates.