NEW YORK CITY (dpa-AFX) - Verizon Communications Inc. (VZ) is planning to divest its digital media assets including Yahoo and AOL, as part of the telecom giant's plan to exit from its investments in digital media.
According to sources, the deal could be worth $4 billion and $5 billion and might involve private-equity firm Apollo Global Management Inc.
Verizon had purchased AOL in 2015 and Yahoo in 2017 for a sum of more than $9 billion as it wanted to make its mark in the ever-growing market of online media. Also, the fact that many people had their accounts in these two websites also attracted the Verizon investment.
In 2020, Verizon's digital media segment, including Yahoo Finance, Yahoo Mail and news sites like TechCrunch, Engadget, brought in revenues of $7 billion, down 5.6 percent from last year. This was mainly due to a sharp fall in advertising revenues in the first half of the year due to the COVID-19 pandemic.
In the latter half of the year, the digital media segment saw a 10 percent rise in revenues in the first quarter to $1.9 billion.
If Verizon sells in the present scenario, it would be raising cash at a time when the values of similar assets are rising. In 2021, the company has pledged around $53 billion to purchase spectrum licenses to support its 5G wireless network.
Copyright RTT News/dpa-AFX
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