NEW YORK • Verizon Communications said it is selling its media division to Apollo Global Management for US$5 billion (S$6.7 billion), a move that will jettison once-dominant online brands like AOL and Yahoo.
The unit will be known as Yahoo after the close of the transaction, which is expected in the second half of this year, Verizon said in a statement yesterday.
Mr Guru Gowrappan will remain chief executive of the media group.
Verizon will keep a 10 per cent stake in the business, the company said, confirming an earlier Bloomberg News report.
With the sale, Verizon is unloading the remnants of an ambitious but distracting foray into online advertising.
Last year, the telecommunications giant agreed to sell the HuffPost online news service to BuzzFeed, and in 2019 it sold the blogging platform Tumblr.
The phone company's priority today is its wireless business and the construction of a multibillion-dollar network for advanced 5G services. Verizon's investments in online advertising did not pay off.
The company acquired AOL for US$4.4 billion in 2015.
AOL head Tim Armstrong said at the time that he wanted to build a "house of brands" at Verizon under a division dubbed Oath.
In 2017, the company bought Yahoo's Internet properties for about US$4.5 billion, betting its one billion-plus users would be a fertile audience for online ads.
But in 2018, after Mr Hans Vestberg took over as Verizon's CEO, the company wrote off more than US$4 billion of its media holdings, or roughly half the value of those businesses, and renamed the division Verizon Media Group.
Verizon Media has more than a dozen online brands, according to its website.
The division had first-quarter revenue of US$1.9 billion, up 12 per cent from a year earlier, according to a filing. Verizon shares were up 0.7 per cent to US$58.18 at 9.44am yesterday in New York.