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Anonymous
Yahoo may be heading into its final act as an independent company.
2015-12-02 17:30:40 Post No. 4637
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Yahoo may be heading into its final act as an independent company.
Anonymous
2015-12-02 17:30:40
Post No. 4637
[Report]
http://fortune.com/2015/12/02/5-notes-on-the-yahoo-sale/
http://www.wsj.com/article_email/yahoo-board-to-weigh-potential-sale-of-internet-business-sources-say-1449015461-lMyQjAxMTI1MjA0MjkwNjIyWj
>Today’s deal buzz is a Wall Street Journal story about how Yahoo’s board is “planning a series of meetings this week to consider selling off the company’s flagging Internet businesses and how to make the most of its valuable stake in Chinese e-commerce powerhouse Alibaba Group.”
>I’ve so far had a handful of conversations with folks who are either close to Yahoo YHOO 6.91% or potential bidders (including within the past hour), and here is what I’m hearing so far:
>1. Legit? Despite the WSJ portrayal, these are not meetings that are being specially called to discuss a sale. These are the company’s regularly-scheduled financial planning meetings. So of course an evaluation of strategic options will be included, particularly for a company under activist pressure that has recently lost so many senior executives.
>That said, a sale of “core Yahoo” — or at least a serious attempt — does seem likely, perhaps as early as Q1 2016.
>2. Financial sponsors? Private equity will certainly take a hard look, particularly those firms that had conducted due diligence back in 2011 (here’s a refresher). The real question, however, is if private equity could find enough leverage to make such a deal work. Big consumer tech deals are few and far between (is Skype the last?), and the pricing on this would be particularly tricky. Do you pay a premium to EBIDTA, even though the actual stock market is effectively valuing Yahoo’s core business (ex-Alibaba BABA 1.16% and cash on hand) at zero? If private equity were to buy, one would imagine it would do a lot of cutting, in order to grow a smaller core of homepage, Tumblr, news, sports and mail (i.e., cut to expand, destroy to create, etc.). Then try to flip it to a strategic.
