Verizon CEO Lowell McAdam, in an interview with Jim Cramer on CNBC’s Mad Money, confirmed the carrier’s interest in a potential acquisition of Yahoo.
The discussion started with talk about Verizon’s acquisition of AOL. Last year Verizon paid $4.4 billion for AOL with an eye on boosting its LTE wireless video business, its “over-the-top” video offerings and creating “a growth platform from wireless to IoT for consumers and businesses.”
AOL invested in a digital advertising platform and also owns valuable content brands, including Huffington Post, Engadget, TechCrunch and Makers. For Verizon, this is the latest in a string of acquisitions aimed at beefing up its digital media business. Last year the carrier bought Intel Media for Internet video technology, content delivery network EdgeCast Networks, and live video encoder UpLynk.
“We had to really transform ourself,” McAdam said of Verizon in 2015. “We bought AOL. We think that can turn into a real growth engine for us.”
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“Why not add Yahoo,” Cramer asked, noting that the company was nearly being “given away. You can’t rule it out. It’s too good a property.”
“We said we would look at it,” McAdam said. “We have to understand the trends that we’re seeing in some of their results now. At the right price, I think marrying up some of [Yahoo’s] assets with AOL…would be a good thing. One of the things we did [with AOL] was keep it separate from the core company. We have been feeding information from out mobile subscribers into the AOL engine. We’ve only had it six months at this point…I don’t want to declare victory; we’ve got a long way to go. Perhaps some things from Yahoo might make sense. I think we can turn [AOL] into something special.”
Rumors about Verizon’s interest in Yahoo began back in December when the Wall Street Journal broke the story. Specifically, the report suggested Yahoo wanted to sell its Internet businesses including the search platform, Yahoo News, Yahoo Mail, social media site Tumblr and other holdings.
Verizon CFO Fran Shammo added fuel to the fire when, also in December, he said, “If Yahoo is right,” Verizon could be interested in a potential acquisition, according to a report in the Washington Post.