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Business

Yahoo sold to Verizon for $5 billion

Opening sequence

Opening sequence

Business

Yahoo sold to Verizon for $5 billion

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COMING UP:Yahoo sold to Verizon for $5 billion

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Transcript

00:00:01
>> Yahoo, once a major internet pioneer, now just another piece of Verizon's empire. The mobile carrier on Monday purchasing Marissa Mayer's struggling web portal for $4.8 billion, after several rounds of bidding. The deal ending months of uncertainty and pressure from investors over the dot com giants future. As Reuters Carl O'Donnell explains, this is essentially the end of Yahoo as we know it.
00:00:26
>> All that will be left in the company is the value of its stake in a variety of different investments. The most valuable of which by far is its holding in Alibaba Group. The Chinese tech startup. People estimate that stake in Alibaba that it bought for only about a billion dollars a few years back, now makes up the majority of its market capitalization, which is about $36 billion.
00:00:46
So the big question facing Marissa Mayer is, how is she going to return the value of that stake to shareholders?>> Yahoo was once one of America's most iconic tech brands. But it's stumbled over the years as rising giants like Google and Facebook have grown explosively. Still, Verizon is banking on Yahoo's potential to compete with the big boys when it comes to clicks.
00:01:07
>> One of the ironies of this deal is that it's actually a relatively small deal for Verizon, its acquirer. Verizon has a market capitalization of about $223 billion and what it's gonna do is it's going to take Yahoo's portfolio of media brands like Yahoo Finance, which generates millions of views every month.
00:01:24
And it's gonna bolt that on to its existing media brands through AOL which includes The Huffington Post, for example.>> $5 billion is pocket change against Yahoo's peak value of over 125 billion in early 2000. Mayer was brought in fours years ago to turn the company around. She said in a Tumblr post that she was planning to stay on under Verizon's ownership.