Verizon chief denies takeover interest in AOL
07 Jan 2015
Verizon Communications has denied reports of exploring a potential acquisition or joint venture with AOL Inc to help it expand mobile-video offerings (See: Verizon eyeing AOL takeover: reports).
Speaking at a conference yesterday, Verizon chief executive officer Lowell McAdam said the company was not having ''significant acquisition discussions'' and was more interested in partnerships with media companies and content providers, rather than buying them.
According to McAdam, AOL, along with lots of other media companies, were potential for Verizon to do partnerships.
Verizon was mainly interested in AOL's programmatic advertising technology - the automated buying and selling of ads online - which could be paired with a future online-video product, according to two of the people.
A takeover would fetch the company paying subscribers as also internet properties including the Huffington Post, which AOL had acquired in 2011 (AOL to acquire news blog service `The Huffington Post' for $315 million).
AOL CEO Tim Armstrong had used digital-advertising acquisitions for transforming the internet portal once known for its ''You've got mail'' alerts. Verizon was seeking expertise in three areas - online content, mobile video and advertising, according to one person and a venture - rather than a takeover - would keep it focused in those areas.
McAdam told investors at the Citi Global Internet conference, ''I think AOL along with lots of other media companies are potential for us to do partnering with on a commercial basis,'' The New York Post reported.
''But to say that we are having significant acquisition discussions is not really accurate.''
Verizon which is close to AOL is also said to be its biggest advertiser as also a major sponsor of the firm's Endgadget tech site. Top members of Verizon's marketing staff had shared the stage at AOL's upfront presentation for advertisers last spring.
According to commentators, one analyst, Colby Synesael at Cowen and Co had valued AOL at $4 billion, which could not be considered large considering its recent $130 billion deal to acquire the balance of Verizon Wireless.