Shareholders Analysis: Verizon Case

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Stakeholders Analysis
Shareholders is obviously not only unsatisfied with Mayor’s 4-year management but also unhappy about this recent deal. The dozens of acquisitions made by Marissa Mayor probably looked like risky, uneconomical moves that Yahoo investors might hate. Yahoo has intention to register itself as an investment company with a new name with the U.S. Securities and Exchange Commission (SEC) after the deal closes.
Shareholders suing Yahoo officers and directors in a class action already underway in San Francisco federal court claim the company should have registered as an investment adviser no later than 2013 – and that its failure to do so prohibits Yahoo from selling its Internet assets. (Frankel, 2016) Companies like
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As a communication giant with solid foundation, Verizon is still facing a transition from simple communication service to multiple internet services. Some people think that the acquisition of Yahoo is an extensional action of Verizon acquiring AOL last year, because AOL and Yahoo are similar traditional internet business. The core Internet business Yahoo sold to Verizon is a remedy for Verizon’s shortage of digital media business. Through Yahoo's online business, Verizon’s future layout may be faster. The online digital media services platform will not only help Verizon’s business expansion, but also can help Verizon to further enhance its corporate value and brand through Internet channels. CEO Lowell McAdam of Verizon says his company intends to become a significant player in digital media. (Knutson, 2016)

Alibaba is another key stakeholder in this deal. The 384 million shares of Alibaba Yahoo invested now worth almost $32 billion. After the deal with Verizon, Yahoo still keeps its 15 percent stake in Alibaba, which has been making tremendous profits for Yahoo for many years. If Yahoo sold the Alibaba stake outright, it would incur huge tax bill so Yahoo is aiming at how to minimize their tax bill. One possible method is letting Alibaba purchase the remaining asset of the renamed Yahoo company as a whole. Good news is that Alibaba has shown interests in purchasing back the
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