May 4, 2021: -On Monday, the companies announced that Verizon would sell its media group to private equity firm Apollo Global Management for $5 billion. The sale allows Verizon to offload properties from the former internet empires of AOL and Yahoo. Verizon will have a 10% stake in the company, and it will be rebranded to Yahoo.
The sale will have online media brands under the former Yahoo, and AOL umbrellas such as TechCrunch, Yahoo Finance, and Engadget go to Apollo at lesser valuations than they commanded a few years ago. It purchased AOL for $4.4 billion in 2015 and Yahoo two years later for $4.5 billion.
Verizon will receive $4.25 billion in cash from the sale and its 10% stake in the company. Verizon and Apollo said they expect the transaction to close in the second part of 2021.
There has been rising evidence that Verizon wanted to sell off its media properties and instead focus on its wireless networks and internet provider businesses.
Before that, it’s original vision was to turn Yahoo and AOL properties into media behemoths that could take on the dominance of Google and Facebook in online advertising. Under former AOL CEO Tim Armstrong, the Yahoo and AOL brands were made online media division within Verizon known as Oath.
But the Oath project failed to gain momentum, and Armstrong left the company in 2018.
Oath rebranded as Verizon Media Group in November 2018 and was run by Guru Gowrappan. Gowrappan will lead Yahoo under Apollo.
Sale of Yahoo and AOL, It said it is no longer interested in media, unlike its rivals. AT&T is still trying to grow WarnerMedia into a to Netflix and Disney, even as it struggles with loads of debt from its media acquisitions.
The sale of Verizon Media to Apollo marks the latest turn in a decades-long roller coaster ride for AOL and Yahoo, two dominant forces in the early days of the consumer internet. After spinning out from Time Warner, AOL struggled under its CEO Armstrong instead of making bold bets on digital media properties such as HuffPost and the network of local news sites called Patch.
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