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Verizon Exploring Sale of Oath Media Assets: Report

Former Yahoo and AOL properties seen going for steep discount from what telecom giant paid for them.

Verizon  (VZ) - Get 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.

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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 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.