The remains of Yahoo after its sale to Verizon will become known as Altaba.
One of the final chapters of the company’s failed-turnaround saga came the evening of Jan. 9, when Yahoo said it would change its name after the sale of its core business to Verizon was completed. Six directors, including CEO Marissa Mayer, will step down from the board.
What’s left remaining is Altaba (formerly known as “RemainCo”), a holding company for Yahoo’s 15% stake in Alibaba and its 35.5% stake in Yahoo Japan.
The name—apparently a portmanteau of “alternative” and “Alibaba“—is awful, but it perfectly epitomizes what Yahoo has become. Mayer came to Yahoo in 2012 with the mandate of turning around the beleaguered internet giant, but in the process investors decided the cause was hopeless and Yahoo’s only saving grace had nothing to do with its homepage, communication products, or “Mavens” (the catchall phrase Mayer coined to represent Yahoo’s new mobile, video, native, and social unit).
The appointment of Mayer—previously a high-profile Google executive—had excited people in the industry and employees at the company. Suddenly, Yahoo seemed hip. She grabbed headlines as she acquired companies like analytics firm Flurry, news-reading app Summly, and blogging platform Tumblr, the last of which she paid $1 billion for. Though her little shopping spree was funded by the company’s stake in Alibaba (it sold 40% of its original stake for $7.6 billion in 2012), investors gave her much leeway.
When Yahoo’s comeback never came, however, shareholders more or less wrote off Yahoo as a business and zeroed their sights on the Alibaba and Yahoo Japan stakes, the only parts of the business they deemed worth anything. Indeed, during Yahoo’s very tumultuous 2015, some pointed out that after subtracting the value of its Alibaba stake, Yahoo Japan stake, and cash and other assets, Yahoo’s business was essentially worthless. After a series of false starts, including a plan to spin off Yahoo’s Alibaba stake without incurring any taxes, the company ultimately decided it would sell its core business to Verizon and keep everything else under what is now “Altaba.”
When Mayer stepped in as CEO, Yahoo was a company with $4 billion in annual revenue, $6 billion in cash, and a billion users. After it’s hacked to pieces, it will be nothing more than “alternative Alibaba.”