The board of Yahoo Inc is to discuss the potential sell-off of the beleaguered Internet company’s core business during a series of meetings this week, people briefed on the plans said on Tuesday.
Directors of the company are also to discuss whether to move forward with a spinoff of Yahoo’s 15 percent stake in the Chinese e-commerce giant Alibaba Group Holdings Ltd (阿里巴巴). The board will weigh all its options, and it is unclear whether the directors will change course, said the people, who spoke on the condition of anonymity because they were not authorized to publicly discuss the plans.
Still, the discussions — which are expected to take place at a regularly scheduled board meeting — highlight the difficulties that have long troubled one of the most prominent Internet companies.
Photo: AFP
The discussions are also expected to put attention squarely on Yahoo chief executive officer Marissa Mayer and the company’s direction under her leadership. Although Mayer is credited with stabilizing the company, which was in rapid decline, Yahoo has introduced no breakthrough products during her three years at the helm and has fallen further and further behind competitors like Facebook Inc and Google Inc in the battle for advertising dollars.
A representative for Yahoo declined to comment on the plans.
Under the leadership of Mayer, a highly vaunted Google executive brought in to drive the latest turnaround effort, the company has spent billions of dollars on acquisitions like Tumblr and Polyvore that have yet to prove their value. In October, the company announced it was writing off US$42 million that it had wasted on an ill-fated foray into original video programming.
Hundreds of millions of people continue to use Yahoo, which was a pioneer on the Internet, so the core business could have value to a potential acquirer.
“The saving grace for Yahoo is that it still has a relatively large user base that is reliant on the platform so long as they maintain e-mail addresses there. It also has a still relatively strong [and still relatively large] sales force,” wrote Brian Wieser, an analyst at Pivotal Research, in a note to clients on Tuesday night. “As long as both of those factors remain in place, there would be time for an acquirer to establish new strategies and develop products while the property continues to generate cash flow.”
The greater value to shareholders has come from Yahoo’s large stakes in the Chinese Internet company Alibaba and in Yahoo Japan, which is controlled by the Japanese investment firm SoftBank Corp. Subtract the Alibaba and SoftBank stakes and the value of the remaining company is less than zero.
The planned board discussions were reported on Tuesday evening by the Wall Street Journal. In an interview on Tuesday after news of the potential board talks was published, Yahoo senior vice president for communications products Jeff Bonforte said employees were continuing to work on new products and features as the larger discussions about the company’s fate continued.
“It’s clear that Marissa came in with a timeline of three to five years,” Bonforte said.
He said that ultimately his team members did not have any control over how much time they would get to show results.
“I just try to ship products that I’m not ashamed of,” he said.
The board’s deliberations are also taking place under pressure from a prominent activist investor, the hedge fund Starboard Value, which has spent more than a year trying to push Yahoo to take action to raise its stock price.
Last month, Starboard called on Yahoo to abandon the spinoff of the Alibaba stake after the Internal Revenue Service declined to bless the potential deal as tax free. That could negate the rationale for the spinoff and lead to a tax bill of several billion dollars.
While Yahoo could fight a tax determination, Starboard has argued that the upside of winning that battle would be limited.
Should Yahoo put its core business up for sale, the operations are expected to draw takeover interest from other technology companies as well as private equity firms, analysts and investors have said.
A representative for Starboard declined to comment.
BIG BUCKS: Chairman Wei is expected to receive NT$34.12 million on a proposed NT$5 cash dividend plan, while the National Development Fund would get NT$8.27 billion Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday announced that its board of directors approved US$15.25 billion in capital appropriations for long-term expansion to meet growing demand. The funds are to be used for installing advanced technology and packaging capacity, expanding mature and specialty technology, and constructing fabs with facility systems, TSMC said in a statement. The board also approved a proposal to distribute a NT$5 cash dividend per share, based on first-quarter earnings per share of NT$13.94, it said. That surpasses the NT$4.50 dividend for the fourth quarter of last year. TSMC has said that while it is eager
‘IMMENSE SWAY’: The top 50 companies, based on market cap, shape everything from technology to consumer trends, advisory firm Visual Capitalist said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) was ranked the 10th-most valuable company globally this year, market information advisory firm Visual Capitalist said. TSMC sat on a market cap of about US$915 billion as of Monday last week, making it the 10th-most valuable company in the world and No. 1 in Asia, the publisher said in its “50 Most Valuable Companies in the World” list. Visual Capitalist described TSMC as the world’s largest dedicated semiconductor foundry operator that rolls out chips for major tech names such as US consumer electronics brand Apple Inc, and artificial intelligence (AI) chip designers Nvidia Corp and Advanced
The Eurovision Song Contest has seen a surge in punter interest at the bookmakers, becoming a major betting event, experts said ahead of last night’s giant glamfest in Basel. “Eurovision has quietly become one of the biggest betting events of the year,” said Tomi Huttunen, senior manager of the Online Computer Finland (OCS) betting and casino platform. Betting sites have long been used to gauge which way voters might be leaning ahead of the world’s biggest televised live music event. However, bookmakers highlight a huge increase in engagement in recent years — and this year in particular. “We’ve already passed 2023’s total activity and
Saudi Arabian Oil Co (Aramco), the Saudi state-owned oil giant, yesterday posted first-quarter profits of US$26 billion, down 4.6 percent from the prior year as falling global oil prices undermine the kingdom’s multitrillion-dollar development plans. Aramco had revenues of US$108.1 billion over the quarter, the company reported in a filing on Riyadh’s Tadawul stock exchange. The company saw US$107.2 billion in revenues and profits of US$27.2 billion for the same period last year. Saudi Arabia has promised to invest US$600 billion in the US over the course of US President Donald Trump’s second term. Trump, who is set to touch
RSS