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Yahoo Seen Bringing Verizon Heft In Ad Technology, Mobile Video

Troubled Web portal Yahoo ( YHOO ) would be a good fit for Verizon Communications ( VZ ), bringing the communications giant more heft in advertising technology and mobile video, Macquarie Capital said Tuesday. Verizon reportedly is among those that plan to bid for Yahoo’s Web business and its holdings in Yahoo Japan. Yahoo is looking to sell all or part of its operations, including its core search business and substantial holdings in Alibaba Group ( BABA ) and Yahoo Japan. Yahoo reportedly has set an April 18 deadline for bids. In the meantime, it faces a proxy fight from activist investor Starboard Value, which wants to oust the entire board. “Yahoo’s current turnaround plan focuses on three key platforms (mail, search and Tumblr), four key verticals (news, sports, finance and lifestyle), and two advertiser offerings (Gemini and BrightRoll),” wrote Macquarie analyst Amy Yong in a research report. “Yahoo’s strategy and assets fit well with Verizon’s three-pronged plan, but execution is key,” she said. “If done properly, we believe the companies’ combined assets would allow for more aggressive competition in spaces including: ad-tech and mobile video … as well as content and display advertising.” “Significant” job cuts would result from a Verizon-Yahoo deal, Yong said. Yahoo already is in the process of axing 15% of its workforce, or about 1,600 jobs. Macquarie analyst Ben Schachter estimates that Yahoo’s core business could fetch $3 billion to $5 billion. He estimates 2016 EBITDA (earnings before interest, taxes, depreciation and amortization) of $750 million. Yahoo’s market cap is $34.5 billion. Yahoo Revenue Seen Falling 15% This Year An estimated 40 groups have expressed interest in buying all or part of the financially wilting Sunnyvale, Calif.-based Web portal. News site Re/Code said last week that documents Yahoo provided to potential bidders predict that the Web portal’s 2016 revenue will drop by close to 15% and its earnings by more than 20%. Rumored bidders for Yahoo include the Daily Mail, the British tabloid newspaper which on Monday reportedly confirmed its interest, attracted to Yahoo’s popular news and media properties. The Daily Mail is in preliminary talks with other investors to launch a bid for Yahoo, the Wall Street Journal reported Monday, confirming a previous WSJ report out Sunday. Yahoo stock rose more than 1% on Monday and was up a fraction, near 36.50, in midday trading in the stock market today . Yahoo sent a letter to possible buyers last month, asking them to submit bids. Some buyers might be interested in all or part of Yahoo’s core Web business, while others might want Yahoo’s stakes in China e-commerce Alibaba or Yahoo Japan. Google, the main division of Alphabet ( GOOGL ), reportedly is considering a bid for Yahoo’s core business. Media company Time ( TIME ); Japan’s SoftBank ( SFTBY ), the majority owner of Yahoo Japan; and several private equity firms also are kicking the tires, reports Bloomberg. Yahoo has also held meetings with IAC/InterActiveCorp ( IAC ) and CBS ( CBS ), the WSJ said. One-time potential suitors including AT&T ( T ) and Comcast ( CMCSA ) have decided against bidding, Bloomberg reported.  Microsoft ( MSFT ), which failed with a hostile bid for Yahoo in 2008, also won’t bid, according to Bloomberg.

Yahoo News Sites Attract British Tabloid Daily Mail: Report

Yahoo ( YHOO ) stock rose Monday as British tabloid newspaper Daily Mail reportedly confirmed its interest in the Sunnyvale, Calif.-based Web portal, attracted to its news and media properties. The Daily Mail said that it is in preliminary talks with other investors to launch a bid for Yahoo, the Wall Street Journal reported Monday, confirming a previous WSJ report out Sunday. Buying Yahoo’s media operations could help the Daily Mail establish a stronger presence in the U.S., where it launched a website in 2012, the WSJ  said. “Given the success of DailyMail.com and Elite Daily, we have been in discussions with a number of parties who are potential bidders,” the WSJ said it was told by a spokesperson for DailyMail.com. Discussions are said to be at a very early stage. A bid by the Daily Mail could occur through a private equity partner acquiring all of Yahoo’s U.S. operation, according to the WSJ. After that, the Daily Mail would take over Yahoo’s news and media units, which include Yahoo Finance, Yahoo Sports and Yahoo News, the report said. It’s also possible a private equity firm would acquire Yahoo and merge its media and news properties into a new company that would include the Daily Mail’s online properties, the report said. The Daily Mail has spoken with six private equity firms in regards to a bid, including General Atlantic, the WSJ said, citing an unnamed source familiar with the matter. The Daily Mail & General Trust PLC is just one of an estimated 40 groups that have expressed interest in buying Yahoo. Yahoo sent a letter to possible buyers last month, asking them to submit bids. Some buyers might be interested in all or part of Yahoo’s core Web business, while others might want Yahoo’s stakes in China e-commerce giant Alibaba Group ( BABA ) or Yahoo Japan. Yahoo pushed back the deadline for bids to April 18 from April 11, according to media reports. Verizon Communications ( VZ ) is said to be planning to bid for Yahoo’s Web business and its holdings in Yahoo Japan, according to Bloomberg. Google, the main division of Alphabet ( GOOGL ), reportedly is considering a bid for Yahoo’s core business. Time ( TIME ); Japan’s SoftBank ( SFTBY ), the majority owner of Yahoo Japan; and several private equity firms also are kicking the tires, reports Bloomberg. Yahoo has also held meetings with IAC/InterActiveCorp. ( IAC ) and CBS Corp. ( CBS ), the WSJ said. One-time potential suitors including AT&T ( T ) and Comcast ( CMCSA ) have decided against bidding, Bloomberg reported.  Microsoft ( MSFT ), which failed with a hostile bid for Yahoo in 2008, also won’t bid, according to Bloomberg. Re/Code said last week that documents Yahoo provided to potential bidders predict the Web portal’s 2016 revenue will drop by close to 15% and its earnings by more than 20%. Yahoo has recently implemented layoffs and begun the process of selling itself and spinning off its hefty stake in Alibaba, and it is also in the midst of a proxy fight seeking to oust its entire board. Yahoo stock was up more than 1% in midday trading in the stock market today , near 36.50. Yahoo stock touched an eight-month high of 37.50 last week.

Is Amazon-Backed Web China Grocery Vendor Yummy77 ‘Out Of Cash’?

Amazon.com ( AMZN )-backed Chinese online grocery sales website Yummy77 might have run out of cash, making it the first major casualty of China’s super-competitive online grocery market, according to Young’s China Business blog. The report comes after two major new funding announcements illustrated the potential for online grocers in China. Amazon’s name still appears at the top of Yummy77’s webpage, with the notation that it is a “strategic cooperative partner,” and clicking on the name takes you to a Yummy77 food section on Amazon’s own China website. “But Amazon’s China page also contains its own Amazon-branded food section with extensive offerings. That would seem to indicate that Yummy77 was still operating independently and was only getting marketing assistance from Amazon as a strategic partner,” the report said . China’s Yummy77 is not related to the Los Angeles-based online grocery company Yummy.com, a spokesperson for the U.S. company confirmed to IBD. Yummy77’s troubles highlight the big potential — and the big risks — for online grocers in China, where the market is teeming with new companies rushing to cash in on the trend. The Yummy77 report comes after two other online fresh food sellers raised big bucks in March. Yiguo — backed by China e-commerce giant Alibaba Group ( BABA ) — raised $260 million, the report said. Another China e-commerce leader, JD.com ( JD ), backs Fruitday, a fresh produce electronic retailer which raised $100 million in new funding , said the report. “Entrepreneurs are realizing that Chinese consumers are very willing to buy almost anything over the Internet that used to be sold in traditional brick-and-mortar stores. Even highly perishable items like fruit and meat are following the trend, thanks to recent logistical improvements that are making same-day deliveries common, sometimes just an hour or two after an order is placed,” Young’s China Business said in a prior report in March . Chinese Internet companies are in a sweet spot as the country quickly moves to broadband mobile platforms, fueled by a burgeoning middle class with more disposable income. In May, JD.com launched a grocery delivery service in partnership with stores in select urban areas. It also invested $70 million in Fruitday. JD.com stock was up 1.5% in afternoon trading in the stock market today , while Amazon stock was up a fraction and Alibaba stock down a fraction.