Back in 2008 Yahoo shares were falling by about 19 percent, which left shareholders a little unhappy. However, things look as though they have turned around for the company, as Yahoo and AOL merger rumors resurface. AOL shareholders believe that this could help save them around $1.5 billion. This deal does not seem a very popular one, but it’s needed to secure their future.
AOL’s CEO Tim Armstrong is trying scare tactics to get the deal to go through, and has even told shareholders that if they do not go ahead with a deal with Yahoo, then they will have to go it alone in a market that is now much tougher. Talks between the two started back in 2010, we are now in 2011 and things have progressed at a very slow pace, but there are loads of factors that need to be taken into consideration.
Some of these factors include the worth of AOL assets, how they would shape the company in the future and how they can get the most value for the company.
According to sources, the deal is worth anywhere from $1 to $1.5 billion in savings, which is a pretty big difference. The way in which these savings could be made is simple really, as they will then share data centers, and also news, entertainment and sports websites.
Armstrong has the best intentions for Yahoo, who left Google back in 2009. However, the hopes that he would bring them back to their former glory has not gone how they had hoped. We have to ask ourselves if this is a last ditch effort to save the AOL?