AOL and Yahoo will lay off more than 2,000 employees as the companies gear up to combine for the creation of a new media division at Verizon, Reuters is reporting.
The job cuts represent roughly 15 percent of the 14,000 people who work at the firms, a “person briefed on the matter” told Reuters Thursday, adding that a good share of the lost jobs will be in California, although some will be outside of the United States.
News of the cuts comes the same day that Yahoo stockholders formally approved the sale of Yahoo’s Internet division to Verizon for $4.48 billion in cash.
The sale, which will be completed on June 13, ended up being $350 million less than the $4.83-billion Yahoo was originally seeking. Yahoo was forced to drop its asking price after news of two major data breaches that affected more than 1.5 billion Yahoo accounts put its deal with Verizon in jeopardy last year.
Yahoo will officially change its name to Altaba Inc. following the closing of the sale. The new name, it seems, is inspired by the company’s 15 percent stake in Chinese e-retailer Alibaba. CEO Marissa Mayer and board chairman Maynard Webb will resign from the company’s board of directors once the deal is completed.
Verizon plans to rebrand AOL and Yahoo’s Internet division. Both will fall under a newly formed parent company known as Oath.