More signs Verizon reportedly looking at Yahoo
Verizon is considering a bid for Yahoo and reportedly has AOL CEO Tim Armstrong exploring the deal.
The telecommunications giant has given Armstrong, who heads the AOL unit acquired by Verizon in May 2015 for $4.4 billion, a chief role in preliminary discussions on a bid for Yahoo's assets, according to Bloomberg, citing a person close to the situation.
No talks between the two companies have happened and Verizon has not hired bankers to formalize an offer, Bloomberg reported.
Verizon (VZ) shares closed Monday down 0.45% to $50.74, while Yahoo (YHOO) fell 3.3% to $27.05. The Nasdaq Composite lost 1.8%.
Verizon Chairman and CEO Lowell McAdam on Friday told CNBC's Jim Cramer that Verizon is considering a bid for Yahoo. "At the right price I think marrying up some of their assets with AOL under Tim Armstrong's leadership would be a good thing for investors," McAdam told Cramer.
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Verizon acquired AOL in part for its online advertising technology, which Verizon can use online and on mobile video services. Yahoo, too, has valuable ad technology for online and mobile services, as well as popular online content such as Yahoo Sports, Yahoo Finance and Tumblr, the blogging service it acquired in 2013 for $1.1 billion.
In October 2015, Verizon launched its free ad-supported go90 mobile video service that streams TV, sports and other content to smartphones and mobile devices.
Yahoo CEO Marissa Mayer and Armstrong both were executives at Google before taking their current jobs. Armstrong talked with Mayer in 2014 about the potential of combining AOL and Yahoo at the Allen & Co. media conference in Sun Valley, Idaho, according to another person familiar with the situation who spoke to Bloomberg.
Last week, Mayer and Yahoo chairman Maynard Webb announced a revitalization plan includes the option to selling some or all of the company's core Web advertising and media business among the "additional strategic alternatives" it is exploring.
Yahoo and Verizon declined to comment on the situation.
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