On Monday news reports surfaced that Yahoo was to change its name to Altaba, with CEO Marissa Mayer to leave the company.
While there is some truth in these reports, they are not wholly accurate.
The change name to Altaba will only apply to the remains of Yahoo not being sold to Verizon. In the still-to-be-signed $4.8bn deal with Verizon, Yahoo shareholders retain the company’s investment portfolio, which includes a 36% stake in Yahoo Japan and a 16% stake in Alibaba. That remaining part of Yahoo, according to an SEC filing, will be known as Altaba.
The filing also included some details about CEO Marissa Mayer’s future with the
company, with Mayer joining five other board members in resigning from the board. It is worth noting however, that Mayer will continue in her role as CEO and only resign from the board if the Verizon deal goes through. It remains to be seen what Mayer will do after the completion of the Verizon deal, although the CEO said that she was planning to stay in a Tumblr post last year, saying that ‘it’s important to me to see Yahoo into its next chapter.’
Part of Yahoo’s next chapter is of course the multi-billion dollar deal with Verizon, which will see the telco integrate Yahoo’s web portal, search engine, email and news service with AOL – another brand it owns. However, the mega data breach which was disclosed by Yahoo last year has cast a shadow over the deal.
In what has become the biggest data breach in history, Yahoo disclosed that one billion user accounts had been compromised in a 2013 cyber attack. Unfortunately, this was a case of history repeating itself, with the 2013 data breach the second such disclosure in 2016. In September 206, Yahoo blamed an ‘unauthorised party’ for breaking into accounts in a 2014 cyber attack. These breaches raised questions over the Verizon deal, with many pointing to a likely discount being applied to the asking price.
Many referenced specific legal language in the Verizon-Yahoo deal that said that Verizon can withdraw if an event occurs which “reasonably can be expected to have a material adverse effect on the business, assets, properties, results of operation or financial condition of the business.” Adding further fuel to the fire, Verizon’s general counsel Craig Silliman said that it was “reasonable” for Verizon to believe that the impact of the breach was “material”.
It remains to be seen if the asking price will be lowered, with the Verizon deal sill needing to be approved by regulators. It is expected to be finalised in the first quarter of 2017.