Verizon Communications (NYSE:VZ) announced the signing of an agreement to purchase AOL (NYSE:AOL) for $50 per share, an estimated total value of approximately $4.4 billion. The transaction is expected to close this summer, with AOL becoming a wholly owned subsidiary of Verizon upon completion. Tim Armstrong, AOL chairman and CEO, will continue to lead AOL operations after closing.
The acquisition is intended to further Verizon's LTE wireless video and OTT video strategy. The agreement is also intended to support and connect to Verizon's Internet of Things (IoT) platforms to create a growth platform from wireless to IoT for consumers and businesses.
The combination of Verizon and AOL is intended to create a scaled, mobile-first platform targeted at the global advertising industry. AOL's key assets include its subscription business; its portfolio of global content brands, including The Huffington Post, TechCrunch, Engadget, MAKERS and AOL.com, as well as its OTT original video content; and its programmatic advertising platforms.