Verizon nears deal to sell media arm to Apollo

[NEW YORK] Verizon Communications is nearing an agreement to sell its media division to Apollo Global Management, according to people with knowledge of the matter, a move that would jettison once-dominant online brands like AOL and Yahoo!.

A deal for Verizon Media could be announced as soon as Monday, said the people, who asked to not be identified because the matter isn't public. Verizon will keep a stake in the business, they said.

No final decision has been made and discussions could fall through. The assets could fetch as much as US$5 billion, Bloomberg News has reported.

Verizon and Apollo declined to comment.

With the potential sale, Verizon would unload the remnants of an ambitious but distracting foray into online advertising. Last year, the telecom 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 never really paid off. The company acquired AOL for US$4.4 billion in 2015.

Tim Armstrong, head of AOL, said at the time 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 1 billion-plus users would be a fertile audience for online ads.

But in 2018, after Hans Vestberg took over as Verizon's chief executive officer, the company wrote off more than US$4 billion of its media holdings, or roughly half the value of those business, and renamed the division Verizon Media Group.

Verizon Media has more than a dozen online brands. The portfolio includes TechCrunch, Ryot, Built By Girls and Flurry, 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.

BLOOMBERG