Telecommunications provider SBCCommunications (NYSE: SBC) will acquire a 3 percent stake in Yahoo! (Nasdaq: YHOO) by purchasing shares from Japanese investor Softbank, the companies said late Thursday.
Softbank will continue to own more than 16 percent of Yahoo! and willremain the Internet company’s largest shareholder, said Ron Fisher, vicechairman of Softbank America.
“We are glad to have SBC as another largestrategic holder of Yahoo! stock,” Fisher said.
SBC said the deal will strengthen its relationship with Yahoo!, the No. 1Web portal, as the two work on a plan to provide Internet access services.
San Antonio, Texas-based SBC says it is the leading provider of DSLhigh-speed Internet service in the U.S. The company provides a range of telecom andInternet services and owns 60 percent of Cingular Wireless, thesecond-largest wireless communications company in the United States.
Yahoo! chairman and CEO Terry Semel said the agreement “demonstrates SBC’sstrong confidence in Yahoo!’s future direction.”
Yahoo! — which on Thursday won a biddingwar for online employment company HotJobs (Nasdaq: HOTJ) — has been expanding into new areas as it seeks to reverse a decline in revenue.
The company has begun offering paid search services, a videoconferencing ventureand an e-book store, among other things, in a bid to reduce its dependenceon advertising revenue.
The plan with SBC, announced in November, is to provide co-branded DSL anddial-up Internet services beginning in mid-2002. The companies said theywill offer a range of “customized products and services” geared to broadbandInternet access.
SBC and Softbank did not give a price for their planned transaction.Softbank America spokesman Steve Murray told the E-Commerce Times that thevalue was “pretty close” to the market value of Yahoo! shares. In earlytrading Friday, the shares were up 88 cents to $18.65.
Overall, Murray said Softbank is “optimistic” about the outlook for Yahoo!,including the company’s growing e-commerce business. “E-commerce is a bigpart of Yahoo’s ongoing future,” he said.
“It’s obviously an exciting pieceof their ongoing strategy, and something they’re seeing a lot of growth in.”
Yahoo! said Wednesday that its sales volume between Thanksgiving andChristmas surged 86 percent from a yearearlier, as users bought items ranging from video-game consoles to toys andclothing.
The company is now beginning a post-holiday sales channelfeaturing end-of-year discounts from merchants including Eddie Bauer, Godivaand Old Navy.