Yahoo Planning To Sell Its Twenty Year Patent Portfolio

That Yahoo put its core business up for sale was not a great surprise for many in the industry: Yahoo had been struggling to make progress in recent years having effectively been squeezed by larger, rapidly growing businesses such as Facebook and Google. At the end of 2015 the company started closing various divisions in the business. This week it has emerged that the company is believed to be planning the sale of around 3,000 patents, including those that underscore its proprietary search technology. Yahoo has hired Black Stone IP, an investment bank, to handle the sale of the patent portfolio, which dates back twenty years. Bidding is due to start in the next couple of weeks.

It has proven difficult for the market to value the Yahoo core business, with numbers ranging from $4 to $8 billion, depending on the source of the valuation! Yahoo has a complicated structure with many deals across the world: as one example cited by the source website, Yahoo Japan pays Yahoo $100 million in cash every year. Similarly, the value of Yahoo's patent portfolio has proven difficult to value with some researchers subscribing a higher figure to it - Bob Peck, an analyst at SunTrust, earlier in the week gave the patent portfolio a valuation of "at least $1.5 billion."

There are a number of companies believed to be interested in buying Yahoo's core business with America's largest carrier, Verizon Wireless, said to be the favorite. Verizon has recently appointed Bank of America as an adviser in this purchase: the Bank of America understands the Yahoo business very well. Earlier in the week, the Wall Street Journal reported that Verizon's initial bid for the Yahoo core business was indeed $3 billion, including the search and email services. Verizon is likely to be considering Yahoo's core business as a bolt-on to its existing acquisitions and technologies, such as the video platform Go90. Verizon's line of thinking appears to be that Yahoo would sit alongside its other acquired business, AOL, where the search, mail and messenger technologies could be boosted. There are also reputed to be a number of other businesses interested in Yahoo including America's second largest carrier, AT&T, together with a number of private equity companies.

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About the Author

David Steele

Senior Staff Writer
I grew up with 8-bit computers and moved into PDAs in my professional life, using a number of devices from early Windows CE clamshells and later. Today, my main devices are a Nexus 5X, a Sony Xperia Z Tablet and a coffee cup.
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