Verizon Communications Inc.  (VZ) will incur about $500 million in pre-tax costs following its $4.48 billion purchase of Yahoo Inc.'s (YHOO) core business on Tuesday, Reuters reported.

The costs, which Verizon expects to incur in the second quarter, deal primarily with severance payments, acquisition expenses and integration expenses.

Verizon will merge Yahoo's internet services with AOL, which Verizon bought last year, to create a new venture called Oath. Verizon will cut about 15% of Yahoo and AOL employees.

In the filing detailing the upcoming costs, Verizon said it plans to save over $1 billion in operating costs through 2020 as a result of the deal.

Verizon shares were slightly down at $46.68 in midmorning trading.

What's Hot on TheStreet

Beware Tesla fanboys: Tesla (TSLA) burning money, but shareholders are the likely ones to blister and feel the pain. The standard 90-day corporate equity lockup period for Tesla, following its $402.5 million stock sale of March 16, ends Thursday TheStreet reports. As a result, Tesla will be free to conduct another stock offering as soon as Thursday, which is a real possibility given the electric car company's debt situation, partly due to its Solar City investment, and need for additional cash. Any new issuance the company may seek would likely need to take place before July, which is when Tesla issues its quarterly report on car sales. Alternatively, an offering could come in late August after Tesla issues its quarterly financial report.

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