Yahoo CEO Mayer gives birth to identical twin girls

Yahoo is set to spin off its core web services, including Yahoo Mail and its search engine, essentially abandoning its aim to reassert itself as an internet giant. No, Yahoo is not going out of business, so you can rest easy and not worry about your Yahoo mail account and your Yahoo fantasy football league.

Verizon purchased AOL for $4.4 billion, as reported by Forbes.

Meanwhile, Yahoo introduced its messenger app today in a bid to compete with Facebook Messenger.

Appearing on CNBC on Wednesday, Mayer was asked about the twins and the potential time off she would take as a result. I kept seeing articles about her enormous severance package.

While Yahoo’s stock has more than doubled since Yahoo CEO Marissa Mayer took over in mid-2012, Mayer has been unable to spark significant earnings and revenue growth at the company.

Yahoo Chairman Maynard Webb said that there isn’t a proactive movement to sell the company, but that the “board has a fiduciary obligation to engage with any person who comes forward with a good offer”.

A Yahoo spokeswoman said in a statement the Mayer-Bogue family is “beyond thrilled”. In a note to clients, he reiterated a “Buy” option on Yahoo stock with a 12-month target of US$38.

The split has been an idea long in the making. The decision, following three days of board deliberations last week – which, by the way, included board member and Alibaba Chairman/founder Jack Ma – was a rejection of Mayer’s plan to spin off the Alibaba investment and its shares in Yahoo Japan into a new entity and leave the core businesses – which now bring in $1 billion per quarter and are profitable – intact. Recently, the company decided not to spin off its Alibaba (NYSE:BABA) stake.

Under mounting shareholder pressure, Yahoo scrapped that spinoff Wednesday and said that it will instead try to break off everything but the Alibaba holdings into another company.

So why did Yahoo decide to can the Aabaco plan? That idea pleased investors until the Internal Revenue Service declined to rule that the Alibaba spinoff would qualify for a tax exemption. There is a case to be made that Yahoo’s underlying business could be worth something if structured properly.

According to Andrew Frank, an analyst at research firm Gartner, Yahoo is essentially back where it was a year ago, talking about a spinoff and trying to define the identity and value of its core business. That corporate manoeuvr was created to sidestep more than $10 billion in taxes Yahoo might otherwise owe.

Yahoo executives said on a conference call they still believed the original spinoff would have been tax-free but the specter of a big tax bill had unnerved investors.