By Ethan Baron
The Mercury News
WWR Article Summary (tl;dr) As terms of the Yahoo-Verizon deal were announced Tuesday, attention turned to the future of Yahoo’s controversial CEO Marissa Mayer who failed to turn around the Sunnyvale company but has been credited with leading the firm through tumultuous times.
SUNNYVALE, Calif.
In one of the most drawn out and dramatic deals in technology, Yahoo and Verizon said Tuesday they had agreed to cut the sale price of the once-storied company by $350 million, but what remains unknown is the fate of Yahoo CEO Marissa Mayer.
The two firms said Tuesday the sale would go ahead for $4.48 billion, subject to shareholder approval. Yahoo and Verizon agreed on the discount from the original $4.83 billion price after Yahoo late last year announced two record-setting hacks of users’ personal information.
Meanwhile, Verizon assured Yahoo users that their email services would continue under the new ownership.
As terms of the deal were announced Tuesday, attention turned to the future of Yahoo’s controversial CEO, who failed to turn around the Sunnyvale company but has been credited with leading the firm through tumultuous times.
With her future in question, experts were sharply divided over whether her time at the company would ultimately make her an asset to other firms.
Mayer said in July she planned to stay with Yahoo through the sale process, which is expected to conclude between April and June. A Yahoo regulatory filing in January said she would leave the firm’s board if the deal went through. And analysts believe she won’t be kept on at Verizon.
“When a company gets acquired, senior executives typically move along,” said Pivotal Research analyst Brian Wieser.
Mayer, who will, according to a regulatory filing, receive a $55 million golden parachute if she is not retained by Verizon, is unlikely to end up an executive at another firm, Wieser said. She would leave Yahoo even wealthier than when she entered with an estimated net worth of $300 million, meaning she wouldn’t need to work for someone else, and her tenure at Yahoo was not marked by success, Wieser said.
“Does Mayer have any credibility as a manager? Not really,” Wieser said. “I don’t think there’s anyone who could objectively assess Yahoo and say that her executive team did a particularly good job.
“It was a challenged asset from the outset, but the number of ways in which it was mismanaged were significant.”
But analyst Scott Kessler of CFRA Research said Mayer, who had previously worked her way up from software engineer to vice-president at Google, could be seen as an asset by many companies.
“Before she joined Yahoo I think she was pretty well respected given what she accomplished at Google,” Kessler said. “She still has her technology background and experience and chops.
“I think companies would be interested in talking with her. Could she have an impact as a public company board member or adviser? Sure.”
Because she came to Yahoo with expertise in technology rather than media, Mayer might be excused for missteps in Yahoo’s media business that included failed digital magazines, but the firm’s two massive breaches of users’ personal information will likely be laid at her door, Kessler said.
“That calls into question to some extent her technology chops,” Kessler said.
Mayer, 41, was hired at Yahoo in 2012, the fourth CEO in as many years, to right a company still reeling from the 2008 financial crisis. Her strategy of buying companies for product development and to secure talent and proprietary technology put her in the cross hairs of critics.
Activist investor Eric Jackson of SpringOwl Asset Management, who has pegged Mayer’s total compensation for her five years at Yahoo at $365 million, has blamed Mayer for $3 billion in “zero additional value” mergers and acquisitions, and slammed her for the firm’s declining revenues as it struggled in a digital-advertising market dominated by Google and Facebook.
Mayer herself has admitted that Yahoo’s investment in mobile internet services was “late” and “behind.”
In the view of headhunter Paul Herrerias, head of the San Francisco and Silicon Valley offices of executive search firm Stanton Chase, Mayer would be a sought-after corporate leader.
“Being a decision maker is a valuable skill and asset to have,” Herrerias said. “Marissa didn’t always have the clearest vision of the future but she stayed focused and committed to the future.”
Mayer showed courage in her decision making, matured while overseeing Yahoo’s travails, and “gained perspective to be able to make better-quality decisions in the future,” Herrerias said.
“She’s smart, she’s ambitious, and if she remains a little bit humble she’ll be an attractive candidate.”
Among opportunities open to Mayer could be non-operations roles, perhaps as a consultant, Herrerias said.
Yahoo declined to comment on Mayer’s future, or to make her available for an interview.
After Tuesday’s announcement, Verizon offered words of assurance to Yahoo email users.
“We always make sure that customers have continuity of service,” Verizon spokesman Bob Varettoni said. “We’re not planning on having anything disappear.”
Acquisition of Yahoo would turbocharge wireless carrier Verizon’s push for prominence as a content provider and build on its 2015 purchase of digital media company AOL for $4.4 billion.
“We go from having an audience in the millions to an audience in the billions with Yahoo,” Varettoni said. “So the transaction has always made great strategic sense to us.”
