Yahoo announced that it will be changing its name to Altaba. But this development has entailed far more important changes for the beleaguered internet company.
Verizon Yahoo Acquisition
Firstly, there is Verizon’s acquisition of its core businesses, which involves its digital advertising, email, search and other media assets. The deal is valued at $4.83 billion.
Without those core assets, Yahoo would have remained a mere shell of its former self. It is important to note that the deal is not yet final and is subject to amendments. There are even sources who claim that it might even get called off as Verizon is still investigating the series of data breaches at Yahoo last year.
What is Altaba
Presently the remaining company, which will, henceforth be called Altaba, will mostly be in the business of e-commerce as it retained its still sizable stake in the Chinese giant e-commerce company Alibaba.
The name itself, which is a combination of the words “alternative” and “Alibaba” indicates how the organization will move forward with a new corporate identity and what it will focus on.
According to a source cited by the Washington Post, Altaba will primarily become a vehicle for holding Alibaba’s stock. The company also chose to retain its 35.5 share in Yahoo Japan and mulls the sale of its patent portfolio.
Marissa Meyer Departs
With the division of Yahoo into separate entities also came the departure of its CEO Marissa Mayer. Yahoo’s co-founder David Filo and four other members of the Yahoo board will also step down.
Mayer’s case, however, holds particular interest for Yahoo watchers due to her contract. It stipulates that she will get nearly $55 million in compensation if she gets fired within a year of the company’s sale.
There is still no official word about this particular aspect and you may be sure we will be keeping vigil for emerging updates about this so-called Mayer’s golden parachute.
What Will Become of the Yahoo Brand?
It is expected that the Yahoo brand associated with the company’s internet businesses will persist. Verizon will need to think hard about ditching the it altogether. Presently, the Yahoo website ranks in the top three most popular site in the United States, which should continue this 2017. Its Yahoo email service remains popular despite the data breach incidents it was involved with in the past few years.
“Among the many entities that showed interest in Yahoo, Verizon believed most in the immense value we’ve created, and in what a combination could bring our users, our advertisers, and our partners,” Mayer said in a statement. “This sale is not only an important step in our plan to unlock shareholder value for Yahoo, it is also a great opportunity for Yahoo to build further distribution and accelerate our work in mobile, video, native advertising, and social. As one of the largest wireless and cable companies in the world, Verizon opens the door to extensive distribution opportunities.”