AOL Spikes Higher on Verizon Buyout for $4.4B
Increased merger and acquisition activity has yet again brought about another deal. The mobile communication conglomerate Verizon Communications Inc., (NYSE: VZ) is buying the online web service provider AOL Inc., (NYSE: AOL) in a deal worth $4.4 billion dollars. Shares of AOL are spiking higher in premarket trading by 18%.
In a statement released by Verizon, the acquisition is said to enhance LTE services and greatly improve the end-user experience.
Verizon’s Chief Executive Officer Lowell McAdam noted “AOL has once again become a digital trailblazer, and we are excited at the prospect of charting a new course together in the digitally connected world. At Verizon, we’ve been strategically investing in emerging technology, including Verizon Digital Media Services and OTT, that taps into the market shift to digital content and advertising. AOL’s advertising model aligns with this approach, and the advertising platform provides a key tool for us to develop future revenue streams.”
The deal is expected to be finalized during the summer of 2015.