Verizon To Bid $3 Billion for Yahoo’s Core Business, Report Says

Contrary to rumors of disinterest, AT&T appears to be giving Verizon a bit of a fight in the bidding to acquire the assets of flailing Internet company Yahoo.

During the second round of bidding, Verizon came up with an offer in the low end of the $3.5 billion to $5 billion range, Reuters’ sources said. CNBC, citing unnamed sources close to the situation, said Yahoo’s board of directors will meet tomorrow to review offers ahead of a final round of bidding expected to lead to a decision by mid-July. Verizon reportedly offered Yahoo in the realm of $3.5 billion for its assets, while others put forth proposals promising $5 billion or more.

A sale of Yahoo’s internet assets would leave the company just owning a 35.5 percent stake in Yahoo Japan Corp, as well as a 15 percent stake in Chinese e-commerce company Alibaba Group Holding Ltd, which accounts for most of its value.

Verizon has been seen as the front-runner to buy Yahoo as the New York-based telecommunications giant continues to bulk up in the media sector. The Sunnyvale, California, company says it hasn’t set a minimum bid for the patent portfolio that it calls “Excalibur”.

Some private equity firms that had made it through to the second round will not be invited to submit third-round bids, another of the people said. The company hoped to bounce back when it hired former Google executive Marissa Mayer as its CEO almost four years ago, but instead things have gotten worse. AT&T is looking to expand its mobile video offerings. Yahoo, Verizon, AT&T, TPG and Bain declined to comment, while Quicken Loans and Vista did not immediately respond to requests for comment.

Yahoo is considering selling off nearly everything it owns except its lucrative stakes in China’s Alibaba Group and Yahoo Japan because its own revenue has been crumbling for the past decade. It averted a proxy battle for control of the company earlier this year with a compromise that added four new board members, including a hedge fund chief who has been critical of management.