Verizon Communications Inc. has reportedly hired Bank of America (BofA) to take an advantage over other competitors in its bidding for the core assets of Yahoo! Inc. . The U.S. telecom company is seriously interested in buying Yahoo’s core assets, especially its advertising technology tools, Reuters reported, citing people familiar with the matter.
BofA Could Finance Verizon’s Bid
BofA, which was Yahoo’s lead adviser in Alibaba’s spinoff plan last year, has an intimate knowledge about the Internet’s business. The bank could also help Verizon in financing the deal. The telecom’s investment banks team includes Guggenheim Partners LLC, LionTree LLC and Allen & Company.
Verizon has a special interest in Yahoo’s advertising technology tools. The company is also reviewing the Internet company’s other assets that can be combined with the corresponding businesses of AOL. Nevertheless, the company is prepared to buy all the core assets.
As we reported previously, Yahoo should’n brush away Verizon’s bid, given the company’s successful venture into Internet content sphere through the AOL acquisition. Verizon acquired AOL last year for $4.4 billion. The telecom gave AOL CEO Tim Armstrong a free hand to run things as he likes. Other acquisition that the company made was Microsoft Corporation’s proprietary advertising technology division.
AT&T Makes Bids For Yahoo
Verizon started courting Yahoo’s core business in December. CFO Fran Shammo hinted the company was mulling if a strategic fit with Yahoo’s assets existed. These holdings include mail, advertising technology, sports and news sites.
Yahoo, which faces pressure from activist investor Starboard Value LP, put its core business up for the sale in February. The company received more than 10 initial offers ranging from about $4 billion to $8 billion, according to people with knowledge of the matter.
Bidders include Verizon Communications Inc. , YP Holdings LLC, TPG, and a consortium led by Bain Capital LP and Vista Equity Partners LLC. SoftBank seems not interested in buying Yahoo’s core Internet business. But the company may enter into discussions with any buyer that wants to also acquire the Yahoo Japan Corp.
On Wednesday, Bloomberg reported that AT&T Inc. is also taking part in the bidding for Yahoo’s core assets. It is surprising news because the telecom had previously shown no interest in Yahoo’s core business.
Last week, The Wall Street Journal reported that the auction for Yahoo’s core business is expected to draw bids of around $2 billion-$3 billion, versus previous expectations for $4 billion-$8 billion.
Verizon Reaches Deal With Striking Unions
Verizon and striking labor unions have reached a four-year tentative agreement on Friday. The deal, which will be submitted to CWA and IBEW union members for ratification, is expected to end a six-week labor dispute involving 36,000 workers. The telecom’s employees will likely return to work next week, USA Today reported, citing labor and union officials.
“Throughout the past 13 days of negotiations at the Department of Labor, I have observed firsthand the parties’ good faith commitment to narrowing differences and forging an agreement that helps workers and the company. The parties have a shared interest in the success of Verizon and its dedicated workforce. Indeed, these two interests are inextricably intertwined,” U.S. Labor Secretary Thomas Perez said in a statement.
Shares of Verizon Communications Inc. were trading up 0.90% in after-hours session. The stock has been performing well, gaining 8.21% year-to-date.