In a move designed to bolster its content offerings – particularly in video delivered to mobile devices – Verizon is shelling out some $4.4 billion for AOL.
From a Verizon statement released with the hour:
Verizon’s acquisition further drives its LTE wireless video and OTT (over-the-top video) strategy. The agreement will also support and connect to Verizon’s IoT (Internet of Things) platforms, creating a growth platform from wireless to IoT for consumers and businesses.
AOL is a leader in the digital content and advertising platforms space, and the combination of Verizon and AOL creates a scaled, mobile-first platform offering directly targeted at what eMarketer estimates is a nearly $600 billion global advertising industry. AOL’s key assets include its subscription business; its premium portfolio of global content brands, including The Huffington Post, TechCrunch, Engadget, MAKERS and AOL.com, as well as its millennial-focused OTT, Emmy-nominated original video content; and its programmatic advertising platforms.
AOL will become a wholly owned subsidiary of Verizon once the deal is approved. The release says that AOL Chairman and CEO Tim Armstrong will continue to run the company after the deal is complete.
AOL stock was up 18 percent in pre-market trading, while Verizon’s was down almost 2 percent.