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Verizon to buy Yahoo\ s core business for $4.8 billion.

Verizon Communications would buy Yahoo Inc's core internet properties for $4.83 billion in cash. (Source- Reuters). Verizon will combine Yahoo's search, email and messenger assets as well as advertising technology tools with its AOL unit, which it bought last year for $4.4 billion. Verizon has been looking to mobile video and advertising for new sources of revenue outside the oversaturated wireless market.

Commenting on this, Juan Jose Rio, partner at advisory and investment group, Delta Partners,specialising in the telecoms, media and digital space, said:"The acquisition of Yahoo by US telecoms giant, Verizon has created a new digital powerhouse overnight. This is the advent of the telecoms provider now emerging as a media group. And this is clearly the future strategy for Verizon: by complementing the wealth of customer insights and publishing assets it already had through its fixed, mobile and TV offer, with AOL and Yahoo now as assets, Verizon is now capable of providing a robust, end-to-end offer of advertising services for global brands."

"It now becomes somewhat easier to justify investing in content," said Brian Wieser, an analyst at Pivotal Research.

Yahoo Chief Executive Officer Marissa Mayer said on a conference call with investors that she planned to stay at Yahoo through the deal's close. Marni Walden, head of product innovation and new business at Verizon, will head the combined internet unit and said no decisions had yet been made on the management team.

Mayer, in an interview with Reuters, said she still saw a "path to growth" for Yahoo, especially in mobile. "What's exciting about the Verizon transaction is that it brings us back to growth sooner," she said. She said she was "open-minded" about a possible role with the combined companies.

The Verizon deal must be approved by regulators and is expected to be finalised in the first quarter of 2017.

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Publication:CommsMEA
Date:Jul 26, 2016
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