Yahoo is considering selling its Internet business rather than spinning it out into a separate company, according to a Bloomberg report on Friday.
The web portal has yet to approach prospective buyers and has not hired an investment bank, signaling that the idea is still in the very early stages, the report said. Furthermore, Yahoo could still proceed with a plan to spin-off its business, which includes its advertising technology, news, and sports businesses.
rose 2% to $30.75 on Friday.
The company has been struggling for years to revive its growth after failing to react fast enough to the rise of mobile and social networking. Despite multiple turnaround plans, nothing has really worked.
On Wednesday, activist investor and Yahoo shareholder, Starboard Value’s Jeffrey Smith, wrote a strongly worded letter criticizing the company’s board and calling for CEO Marissa Mayer to step down. Yahoo responded by saying that the company in a “multiyear transition” and is preparing to be “more focused.”
Business Insider has reported that the company is planning to announce layoffs of 10% of its employees, or about 1,000 total, during the first quarter.
In November, Starboard Value pressed Yahoo and Mayer to reverse the company’s plan to spin off its large stake in Alibaba, worth north of $25 billion, amid tax concerns about the deal. Eventually, Yahoo decided to spin off its operating business instead of its Alibaba
stake, a move that the company predicted would take at least a year.
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But stakeholders, including Starboard, are getting impatient, and could be pressing Yahoo to sell instead. Possible acquirers include Verizon
, which bought AOL in 2015 for $4.4 billion. In December, Verizon’s chief financial officer Fran Shammo said that the carrier would consider buying Yahoo’s business if it were for sale.
This is all speculative, as Yahoo has still not made any formal moves to sell its business. But we could know more soon. Earlier this week, Yahoo said it would share more about how its turnaround is going sometime later this month. Stay tuned.