Verizon may pony up $3 billion for Yahoo's Web business
The telecom giant planned to submit a proposal before the second round of bidding ended Monday for Yahoo's core online assets, an unnamed source familiar with the matter told the Wall Street Journal. Private-equity firm TPG was also expected to tender an offer before the deadline, the Journal reported, but Verizon is currently seen as the leading contender.
A major Internet player in years past, Yahoo has been trying to revive its slumping business fortunes. CEO Marissa Mayer aimed to shake things up by refocusing the company on its mobile sites and services, but those efforts have left consumers and investors cold. The situation has forced the board of directors to consider options beyond an attempted turnaround, including a potential sale.
Initially, "people close to the process" told the Journal that Yahoo's online business could sell for between \\$4 billion and \\$8 billion. Last month, that range dropped to between \\$2 billion and \\$3 billion for the second round of bidding. Some potential bidders were discouraged after a presentation by Mayer revealed the degree to which Yahoo's online ad business had deteriorated, according to the Journal's sources.
Back in April, around 40 suitors appeared interested in Yahoo's Web business. That list has since been whittled down, though it isn't publicly known which companies are still in the pursuit. Most appear mainly interested in Yahoo's Internet business, but the company also is considering the sale of other assets, such as real estate and patents, which could bring in \\$1 billion.
A Verizon acquisition of Yahoo would round out its \\$4.4 billion purchase of AOL last year. Owning both Yahoo and AOL could help Verizon in its effort to focus on mobile video services and online advertising. Those areas are key if Verizon hopes to transform itself from a telecom carrier to a larger media conglomerate.
Yahoo is expected to host at least one more round of bidding. Verizon and Yahoo declined CNET's request for comment.
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