Update one-of-many-to-come as we monitor M&A activity in the TMT sector: since 12 May, when Verizon announced it would acquire AOL for $4.4bn — roughly 2.2% of its market cap at the time — there had been no real news to report until yesterday.
Done Deal
The deal has now completed, as expected.
On the matter, TechCrunch said: “Well, that was fast: Verizon has just announced that it has completed its acquisition of AOL, owner of TechCrunch, purchasing all outstanding shares for $50 per share in cash for a total price of $4.4bn. The sale was originally announced just over a month ago.”
Something else drew our attention — guess what?
Value
Verizon stock is down 4% over the period, having underperformed the S&P 500 and the Nasdaq by five percentage points and seven percentage points, respectively.
When the deal was announced, AOL’s chief executive, Tim Armstrong, said that the visions of Verizon and AOL were shared — we had our say back then.
As Mr Armstrong continues to spearhead AOL, he is one obvious winner: AOL’s unaffected stock price stood some 20% below its two-year highs the day before Verizon’s offer emerged.
It was worth it, on that basis.