It is no secret in the investment community that Yahoo! Inc. (NASDAQ:YHOO) has its pockets flushed and you don’t have to be very smart to guess what Marissa Mayer is going to do with it given her history, and this time its a hunt for companies in the Ad space or video content. Jonathan Marino explained Yahoo! Inc. (NASDAQ:YHOO)’s options with its newly filled pockets on TheStreet.
“[…] It [Yahoo! Inc. (NASDAQ:YHOO)] already has $8 billion from the stock it has unloaded, half of which will be distributed. How many targets does Mayer have for Yahoo! Inc. (NASDAQ:YHOO) and its cash hole remain to be seen but Mayer’s style seems to indicate that companies could make deal in the space, in the ad space rather or for a video content platform. […],” said Marino.
There are a few problems which Yahoo! Inc. (NASDAQ:YHOO) faces though. The first and foremost of which is that the company still might not have enough money to carry out a major acquisition. This may seem surprising after reading the $8 billion figure above but Yahoo! Inc. (NASDAQ:YHOO) has actually promised to give half of that money to its share holders. It is not certain yet if it will be in the form of dividends or a share buy back program.
Yahoo! Inc. (NASDAQ:YHOO)’s second problem is that it recently announced that it is in a one year share lockdown program with Alibaba. This means that the company will not sell its remaining stake in the Chinese e-commerce giant before a year. The news consequently had a bad effect on Yahoo! Inc. (NASDAQ:YHOO)’s stock price which is down by 9% so far this week according to Marino.
This essentially entails that Yahoo! Inc. (NASDAQ:YHOO) could itself become an acquisition target as the hunter becomes the hunted.
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