Verizon (VZ) - Get Verizon Communications Inc. Report is considering unloading its once-vaunted media properties, which include AOL and Yahoo, for about half of what it paid for them, according to a published report Wednesday.
The telecom giant is working with Apollo Global Management APO on a potential sale, which could yield a price of $4 billion to $5 billion, the Wall Street Journal reported citing people familiar with the matter.
Verizon acquired AOL in 2015 for $4.4 billion prompting some to accuse the company of going into a business outside its core competencies, a process nicknamed “diworsification.”
Verizon acquired Yahoo in 2017 for $4.8 billion, combining it with its AOL operations into an entity called Oath, that was supposed to jump start its online advertising business.
That sale brought to an end a long saga for Yahoo, one of Silicon Valley's original star companies. In 2008 founder Jerry Yang engaged in on-again off-again talks with Microsoft, which bid nearly $45 billion for the web pioneer. Microsoft eventually walked away from a deal citing differences over price.
AOL was once the dominant internet service provider, during the height of the dot-com boom in the late 1990s and early 2000s. It parlayed that status, and its valuation, into a still eye-popping $165 billion acquisition of Time Warner. The pairing proved unworkable as the dot-com bust and great recession took hold, however, and Time Warner wound up spinning off AOL in 2009. The remainder of Time Warner was bought by Verizon rival AT&T (T) - Get AT&T Inc. Report in 2018.
Notwithstanding the big hopes and deep pockets behind the Oath effort, Verizon wrote down $4.6 billion of goodwill of the combined venture in late 2018.
Shares of Verizon fell 1 cent, or 0.003%, to $56.42 in after-hours trading.