Verizon Communications, an American broadband telecom company, will acquire Yahoo in a deal pegged at $4.8 billion. According to media reports, the deal includes Yahoo's core assets, real estate assets and some intellectual property.
Yahoo will, however, retain its stakes in Alibaba Group Holding Ltd. and Yahoo Japan Corp, which would have a combined market value of $40 billion, Bloomberg reported.
Verizon Communications will announce its plans to buy Yahoo's core assets before the U.S. markets open on Monday morning. The deal will finally seal the fate of the web pioneer after months of speculations and increasing pressure from its investors Starboard Value LP.
Post the acquisition, Yahoo's daily users would be added to Verizon's increasing media properties. In addition, Yahoo's CEO Marissa Mayer will step down after failing to re-invent the California-based web portal company.
"They (Verizon) are trying to monetise wireless in an entirely new way. Instead of charging customers for traffic, they are turning to charging advertisers for eyeballs," Craig Moffett, an analyst with MoffettNathason, was quoted as saying by Bloomberg on Sunday.
Yahoo, which is primarily an internet search company, had in February announced that it was looking for alternatives for its core internet business. During the same month, the company had announced it was cutting down its workforce by 15 percent. This included 1,700 layoffs.
On July 18, Yahoo reported losses worth $440 million for the second quarter of the current financial year. The firm's revenues rose $60 million to record $1.3 billion for the quarter that ended on June 30, BBC reported. The increase in revenues was attributed to its core internet business, and mobile revenues.
A BBC analyst Colin Gills had recently expected the value of the deal to be in the range of $5-8 billion.
Verizon had shown interest in acquiring Yahoo's core business since the beginning of the year, when Verizon's Chief Financial Officer Fran Shammo had said the firm would "see if there is a strategic fit for its holdings." The holdings included mail, sports and news technology, Reuters had reported in April.
The other contender for buying Yahoo's core business included its rival search-engine firm Google.