Yahoo’s board has formed a strategic review committee that will begin reaching out to potential buyers, amid a companywide restructuring that will eliminate 15% of its workforce.
The company announced Friday that it has retained Goldman Sachs, J.P. Morgan and PJT Partners as its financial advisers, and Cravath, Swaine & Moore as its legal adviser. Yahoo said it doesn’t plan to make any other disclosures about the sales process “until a definitive transaction agreement is reached or a determination has been made that none will be pursued.”
Shares of Yahoo opened up 2.6% Friday, at $30.18 per share.
Yahoo, unable to stanch ongoing declines in core search and advertising revenue, earlier this month officially announced it would review “strategic alternatives” including potentially selling all or part of the company. Verizon’s AOL unit, headed by CEO Tim Armstrong, has said it would explore a potential deal with Yahoo.
“We have hired excellent advisers and are working closely and in alignment with management to pursue an effective process,” Yahoo chairman Maynard Webb said. “The board is thoroughly committed to exploring strategic alternatives while simultaneously supporting management and the employees in their implementation of Yahoo’s strategic plan.”
CEO Marissa Mayer has been under fire from investors unhappy with the company’s performance under her direction. In a statement Friday, she reiterated that separating Yahoo’s stake in Chinese ecommerce giant Alibaba Group from its operating business “is essential to maximizing value for our shareholders.” Yahoo previously planned to spin off its Alibaba stock holdings. But citing the risk of a tax penalty, in December it reversed course and said it would move forward on a reverse spinoff of the Yahoo business.
“In addition to the reverse spin, there are strategic alternatives that could help us achieve the separation, while strengthening our business,” she said in a statement.
Under Yahoo’s restructuring plan, it will focus media efforts on four vertical segments: news, sports, finance and lifestyle. This week, the company began shutting down seven digital magazines and laying off staffers.