The deal, set to be completed in early 2017, does not include Yahoo’s so-called Excalibur patent portfolio, which reportedly contains more than 3,000 rights, nor the internet company’s highly valued share in China’s Alibaba Group, both of which will be spun off into a new as-yet unnamed investment company.
Uniting Verizon with Yahoo’s global audience of more than one billion monthly active users will create one of the world’s the largest portfolios of “owned and partnered global brands”, with extensive distribution capabilities, Verizon said in a statement on 25 July.
Yahoo’s decision to keep its “non-core” Excalibur patent portfolio, along with its cash, Alibaba stake and Japan business, will fuel speculation that Verizon was not interested in the rights, almost half of which a study recently claimed could be invalid or have no market value.
It is not clear which and how many patents Verizon will acquire from Yahoo.
Verizon acquired AOL for $4.4 billion a year ago. That acquisition was described by Verizon CEO Lowell McAdam as “enhancing our strategy of providing cross-screen connection for consumers, creators and advertisers”.
Marissa Mayer, CEO of Yahoo, described the new union of AOL and Yahoo, which she considers to have “popularised the internet”, as being “poetic”.
“We have a terrific, loyal, experienced and quality team and I couldn’t be prouder of our achievements to date,” Mayer added.