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Marissa Mayer

Yahoo CEO Marissa Mayer reveals what she'll do next

Mike Snider
USA TODAY
Yahoo's Marissa Mayer.

Now that we have a buyer for Yahoo — Verizon — you may wonder what's next for Yahoo CEO Marissa Mayer.

The answer? Continue on as Yahoo CEO to help with the transition, helping join Yahoo with AOL as a mobile and online brand under the telecommunications giant's umbrella.

And Mayer envisions a place for herself at Yahoo, helping expand the mobile reach of its properties through Verizon's network of 112.6 million subscribers.

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"I plan to stay. I love Yahoo and am excited to see it into its next chapter," Mayer said during a conference call Monday. "For the immediate future that means I have two priorities: obviously, seeing this transaction through to closing and also protecting the value in our equity stakes."

A key objective in Yahoo's (YHOO) sale to Verizon (VZ) for $4.8 billion is to separate the core web business from two other valuable assets: Yahoo's 15% stake in Chinese retailing giant Alibaba (BABA), worth $32 billion, and its 36% stake in Yahoo Japan, worth about $8 billion. When the transaction is closed, expected to happen in the first quarter of 2017, the Yahoo brand will belong to Verizon and the remaining company will change its name and become a publicly traded investment company, Yahoo says.

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Verizon plans to keep the Yahoo brand and the company's headquarters in Sunnyvale, Calif., will remain its hub, said AOL CEO Tim Armstrong, who is overseeing the transitioning of Yahoo into the Verizon fold. Verizon acquired AOL in May 2015 for $4.4 billion. "We are going to run it as a house of brands," Armstrong said. "We love the Yahoo brand."

Asked about the future for individual products within Yahoo — Yahoo Finance, Yahoo Sports, Yahoo Mail, Tumblr — Armstrong said a cost evaluation has begun "to maximize our investments in the future businesses that are going to grow. There is a lot of planning to be done and in many cases we are just starting that process."

Armstrong: 'we are friends'

Armstrong said that he could foresee Mayer remaining. "My expectation is Marissa is leading Yahoo and we will continue with that process and working with her on that," Armstrong told USA TODAY Monday. "I have known her for 20 years. We are friends, so I expect to work very closely with her now and in the future."

The two were colleagues at Google. Mayer arrived in 1999, Armstrong in 2000. "Tim and I are old friends and colleagues and very much respect him and I am looking forward to working with him again," Mayer said on CNBC Monday after the announcement of the deal.

That much seems to be the case through the transition. But what after the deal closes early next year?

SunTrust Robinson Humphrey Internet equity analyst Robert Peck said that Mayer's tenure at Yahoo is an open question. Ultimately, Armstrong and Marni Walden, Verizon's executive vice president and president of the product innovation and new businesses organization, will decide, he said.

"Clearly, Marissa has intimate knowledge of all the operations of Yahoo and can be very helpful to them," Peck said. "The question would be ... do they not necessarily need her for the long term."

If Mayer leaves, she'll be given a comfortable sendoff: According to securities filings, she's in line for an estimated $54.9 million payout if she's forced to step down without cause, including due to a "change in control" like the sale of Yahoo.

Wall Street was not enthusiastic about the deal. Verizon shares (VZ) closed down 0.4% to $55.87, while Yahoo (YHOO) shares were down 2.7% to $38.32.

Investors responded to the sale with kind of a collective shrug," said Eric Goodness, vice president at Gartner Research and an Internet of Things analyst. "I'm a little bit surprised about how overall negative the market is but it’s understandable when you look at that trail of tears that led us here," he said. "I understand the promise of the acquisition."

Follow Mike Snider on Twitter: @MikeSnider

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