With Verizon's $4.8 billion purchase of Yahoo's operating business closing this month, CEO Marissa Mayer will leave the Yahoo board, and the remainder of the company will be renamed Altaba.
Yahoo no more: As Verizon takes over the company's core internet business, the investment side of Yahoo will change its name to Altaba Inc., according to a regulatory filing released this week.
With the Verizon closing, Altaba's board will be reduced to five directors: Tor Braham, Eric Brandt, Catherine Friedman, Thomas McInerney and Jeffrey Smith. Brandt will also serve as chairman of the board. That means six Yahoo directors will be leaving, including CEO Marissa Mayer. However, Mayer said she plans to stay with the company after the acquisition.
Altaba still holds assets with Yahoo's stake in Alibaba Group Holdings Ltd. and Yahoo Japan. The name Altaba is a combination of the words "alternate" and "Alibaba," according to the Wall Street Journal.
Verizon announced its purchase of Yahoo for $4.83 billion in July 2016. "The acquisition of Yahoo will put Verizon in a highly competitive position as a top global mobile media company, and help accelerate our revenue stream in digital advertising," said Lowell McAdam, Verizon chairman and CEO, in a press release at the time.
Mayer clarified in the press release that the sale of Yahoo's operating business effectively separated the company's Asian asset equity stakes to "unlock shareholder value for Yahoo."
"This transaction also sets up a great opportunity for Yahoo to build further distribution and accelerate our work in mobile, video, native advertising and social," Mayer said at the time.
However, the acquisition was put in jeopardy after news of two large Yahoo data breaches came to light. In September 2016, Yahoo announced that a 2014 hack had led 500 million accounts to be compromised, including names, email addresses, and passwords. And in December, Yahoo revealed that data from more than one billion user accounts (on top of the original 500 million) had been stolen in 2013.
The regulatory filing states that Verizon may terminate or renegotiate the purchase agreement based on the "security incidents."
In a December 2016 poll of TechRepublic readers asking "Is the Yahoo hack the final straw?" and questioning the state of the Verizon deal, 47% of respondents answered "Yes, and the hack will also nuke the Verizon deal." Meanwhile, 28% said "The hack will kill the Verizon deal, but Yahoo will survive," and 25% said "No, Yahoo will survive and be sold to Verizon."
The 3 big takeaways for TechRepublic readers
- This week, Verizon announced that as its $4.8 billion purchase of Yahoo closes, the investment portion of the company will be renamed Altaba.
- With the Verizon acquisition, Altaba's board of directors will be reduced from 11 members to six, with CEO Marissa Mayer stepping down from the board.
- The Verizon deal could still be terminated or renegotiated due to Yahoo's two major data breaches announced last year, which compromised the data of 1.5 billion Yahoo users.
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- Yahoo hacked again, more than one billion accounts stolen (ZDNet)
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- IT Security in the Snowden Era (ZDNet)
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