Verizon, the US telecommunications giant, has agreed to buy US internet firm, AOL, in a deal worth $4.4bn (£2.8bn), which includes $300 million in debt owed by AOL, the company will wholly become a Verizon subsidiary after the deal is completed. The deal includes AOL’s websites such as the Huffington Post, Techcrunch, Engadget, Maker, and AOL.
The deal includes about $300m of AOL debt. AOL will become a wholly owned subsidiary of Verizon upon completion. The deal will give access to AOL’s automated advertising platforms as well as video content to the acquiring company, Verizon.
According to eMarketer, in 2014, AOL only had 0.74% of the global $145 billion digital advertising market. Verizon says that the deal would give credibility to its 4G wireless video and internet video ambitions and it would also feed its capitalisation plan on the “internet of things”.
AOL current Chief Executive, Tim Armstrong, will continue to lead the firm if the deal goes through since the transaction is subject to regulatory approval. “We are excited to work with the team at Verizon to create the next generation of media through mobile and video,” Mr Armstrong said.
Compared with AOL’s closing price of $42.59 on Monday, May 11, 2015, Verizon is offering $50 per share for AOL.