Verizon announced Tuesday morning that it plans to buy AOL for $4.4 billion.
The all-cash deal between the telecom giant and the owner of The Huffington Post will reportedly be completed this summer, pending regulatory approvals.
Lowell McAdam, Verizon chairman and CEO, said in a press release that the merger will help "provide a cross-screen connection for consumers, creators and advertisers to deliver that premium customer experience."
"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," McAdam stated. "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."
AOL CEO Tim Armstrong, who is expected to continue to lead the company once the deal goes through, emailed the staff with the news:
Tim Armstrong emails staff on Verizon deal: pic.twitter.com/lTf2x0QZLA
— Michael Calderone (@mlcalderone) May 12, 2015
Armstrong also noted that the deal would mean better wages and benefits for AOL employees.
"For you this means growth, it means mobile, and it means compensation that will be equal or better to your AOL compensation. Your benefits will not change in 2015. We will eventually go on Verizon’s benefit plan, but that won’t happen until 2016 or later and we will work with Verizon to make sure the benefits are strong and cover important areas of people's lives," Armstrong wrote. "Your job and what you do on a daily basis should be enhanced by the market opportunity this deal is targeted to capture. The simple answer to the question of 'what does this mean for you?' should be, 'I just got more resources, more support and more growth opportunity.'"
AOL shares rose 18% in premarket trading to $50.27, the Wall Street Journal reported. Verizon shares fell 1.6% to $49.
This is a developing story. More to come...
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