Verizon, US-based broadband and telecommunication company, has announced that it will be acquiring AOL, a multimedia mass media corporation, for $4.4 billion.
The deal means that Verizon will now own TechCrunch and Huffington Post which were acquired by AOL in 2010 and 2011 respectively.
Verizon’s AOL acquisition, according to the news release from Verizon, will drive its digital and video platforms considerably. AOL’s millennial-focused OTT content, original video content; and its programmatic advertising platforms will expectedly help Verizon in onboarding a demography – the notorious cable-cutting millennials – it has been trying to woo to its cable service.
“Verizon’s vision is to provide customers with a premium digital experience based on a global multi-screen network platform. This acquisition supports our strategy to provide a cross-screen connection for consumers, creators and advertisers to deliver that premium customer experience,” says Lowell McAdam, Verizon chairman.
The acquisition will not witness any major corporate shakeup, as AOL’s chairman and CEO, Tim Armstrong, will retain his position in the company once the deal is finalized this summer.
The acquisition process is taking the form of a tender offer as Verizon is offering 17% more than the current share price of AOL. Verizon also indicated that it will be funding the transaction through cash-on-hand and commercial paper.
