Technology

Yahoo to Examine Strategic Alternatives

Paul Ausick

Published: February 19, 2016 9:05 am

Last Updated: January 13, 2020 12:59 pm

Shares of Yahoo! Inc. (NASDAQ: YHOO) got a lift in Friday’s premarket trading following an announcement that the company has formed a committee of independent directors to explore “strategic alternatives alongside its continued consideration of a reverse spin.” The Internet media company has also hired Goldman Sachs, JPMorgan and PJT Partners as its financial advisors, and Cravath, Swaine & Moore as its legal advisor.

Yahoo’s board chairman, Maynard Webb, said:

The Board recently formed an independent committee to conduct a process to evaluate strategic alternatives for the company. We have hired excellent advisors and are working closely and in alignment with management to pursue an effective process. The Board is thoroughly committed to exploring strategic alternatives while simultaneously supporting management and the employees in their implementation of Yahoo’s strategic plan.

CEO Marissa Mayer added:

Separating our Alibaba stake from Yahoo’s operating business is essential to maximizing value for our shareholders. In addition to the reverse spin, there are strategic alternatives that could help us achieve the separation, while strengthening our business.

The company also said that it does not intend to disclose more information on these matters “until a definitive transaction agreement is reached or a determination has been made that none will be pursued.”

Shares traded up about 3% following the announcement, at $30.30 in a 52-week range of $26.15 to $46.17. The consensus price target on the stock is $37.88, according Thomson/First Call.