Yahoo is one step closer to admitting it may need to sell its core business.
The company on Friday announced that it has enlisted the help of financial firms Goldman Sachs , J.P. Morgan, and PJT Partners, along with legal adviser Cravath, Swaine & Moore, to explore possible transactions. Those advisors will aid a Strategic Review Committee comprising independent board members, who will actively seek out transactions for its business.
“The Board is thoroughly committed to exploring strategic alternatives while simultaneously supporting management and the employees in their implementation of Yahoo’s strategic plan,” Yahoo board chairman Maynard Webb said in a statement. “We believe that pursuing these complementary paths is in the best interests of our shareholders and will maximize value.”
While Yahoo didn’t commit to any move in its statement, and said it will not provide additional comment on the Committee’s efforts unless an “agreement is reached,” it’s clear the company is seeking opportunities to sell its core business made up of digital platforms, including e-mail and video, along with several other divisions including its advertising services.
The debate over Yahoo’s business and how to turn it around has been ongoing for several years. In the last year, however, those concerns over Yahoo’s business have intensified.
Activist investor Starboard Value has released several statements recently, arguing not only that Yahoo must consider a sale of its core business, known as Yahoo Core, but also unleash the value the company has in its stake in China-based e-commerce giant Alibaba.
Last year, Yahoo announced plans to spin off its stake in Alibaba into a completely separate company. The idea was to unlock the $30 billion stake Yahoo owns in Alibaba, as well as its $8 billion stake in Yahoo Japan, and transfer that wealth to shareholders. All that would be left of Yahoo would be its core assets.
Yahoo ultimately decided against the spin-off in December after intensifying pressure from Starboard Value, among other shareholders, called on the board to reevaluate its options. That was followed earlier this month by plans from Yahoo CEO Marissa Mayer to spin off Yahoo Core and lay off approximately 15% of the company’s staff. Her plan came after Yahoo reported a 15% decline in adjusted quarterly revenue for the fourth quarter and it again became clear that the company was facing serious difficulty in its digital-advertising battle with Alphabet’s Google and Facebook, among others.