On Monday, Verizon Communications announced the plans to acquire Yahoo for approximately $5 billion in cash.
Share prices of both companies moved slightly higher in premarket trading after the announcement, but turned lower. By early afternoon, Yahoo was down 2.7%.
Verizon president of product innovation and new businesses, Marni Walden said on CNBC that the deal included Yahoo’s core operating business and patents. Walden said that the acquisition will help the telecom company in building a media company as it gives them the scale to increase their audience from millions to billions.
The transaction seems to boost Verizon’s AOL internet business by providing access to Yahoo’s advertising technology.