Verizon Media leadership questioned ahead of Apollo acquisition on September 1
In this photo illustration, a Verizon Media logo displayed on a smartphone.
Igor Golovniov | SOPA Pictures | LightRocket | Getty Images
Apollo Global Management is preparing to close its $ 5 billion acquisition of Verizon Media on September 1, and the private equity firm is already sowing dismay among existing executives at the soon-to-be known as Yahoo.
Apollo has not briefed Verizon Media executives, including chief executive Guru Gowrappan, on their new roles at the company once the private equity firm takes over, according to people familiar with the matter. The lack of information angered current Verizon employees, who are unsure whether they have a long-term future with the company, said the people, who have asked not to be named because the discussions are private.
Private equity takeovers frequently result in significant leadership changes. Strategic changes are often the primary rationale for transactions, and Verizon Media, which will be officially renamed Yahoo upon closing, is likely to be no exception. Apollo worked with Egon Zehnder, an executive search firm, to seek out new leaders. That search includes former Bleacher Report CEO Howard Mittman for a role of “head of sports,” two of the people said. Mittman, who left Bleacher Report last year over concerns about the lack of diversity within the company, declined to comment.
Apollo’s failure to communicate the future roles of existing leaders came up against the private equity firm’s public statement that it is committed to working with the existing leadership team.
“We have tremendous respect and admiration for the excellent work and progress made by the entire organization over the past few years, and we look forward to working with Guru, his talented team and our partners at Verizon. to accelerate Yahoo’s growth in its next chapter, ”said Reed Rayman, Apollo’s private equity partner, in a statement when announcing the deal in May.
Verizon will own a 10% stake in the new Yahoo and entered the deal on the assumption that Gowrappan and his team will continue to run the business, two people said. While Apollo is urged to wait until the deal closes to begin strategic planning to avoid show jumping fines, its lack of clarity and discussions with outsiders for potential roles in the company have makes several executives of Verizon Media fear that their tenure within the company is short. people said.
A spokesperson for Verizon declined to comment. An Apollo spokesperson could not immediately be reached for comment.
Apollo’s Yahoo strategy
Apollo’s plan is to maximize the value of Yahoo by preparing different parts of the company for possible sales or mergers, such as sports, finance and advertising technology, two of the people said. Several Special Purpose Acquisition Vehicles, or SPACs, have already had preliminary conversations with Apollo to show their interest in parts of the business, they said.
Verizon Media is a combination of Yahoo, AOL, ad technology and a few small media companies. He owned the HuffPost before selling it to Buzzfeed under a deal announced last year. The new Yahoo has around 10,000 employees. Yahoo Mail still receives around 200 million unique global visitors per month. Yahoo.com is still one of the most visited websites in the world, according to Alexa Internet, a web traffic analysis company.
Troy Young, the former president of Hearst’s magazine division, who resigned last year after the New York Times reported his story of sexist workplace remarks, has been a senior consultant for Apollo on the deal and Yahoo’s future outlook, four of the people mentioned. He lists the Apollo Global advisor on his LinkedIn page since March 2021.
Business Insider first reported on Young’s role at Yahoo on Tuesday, adding that it had sparked speculation he might be in line for a bigger role at the company.
Young is not a candidate to be Yahoo’s new CEO if Gowrappan does eventually leave, two people said. Still, his constant presence at internal meetings since the deal was announced has prompted some Verizon Media executives to assume he was in line for a major strategic role at the new company, even if it wasn’t. an operational management position, two people said. Young did not immediately respond to the comments.