In order to tap the immense growth potential of the edge solutions market and develop a powerful content-enabled firm with a global scale of operations, Yahoo has decided to divest Edgecast Inc. to Limelight Networks, Inc. in an all-stock deal. The transaction is likely to close in the second half of the year, subject to mandatory closing conditions and regulatory approvals.
Edgecast is a business unit of Yahoo, which is owned by funds managed by Apollo Global Management, Inc. (APO - Free Report) and Verizon Communications Inc. (VZ - Free Report) . It is a leading provider of edge security, content delivery and video streaming services, with a dedicated team of domain experts. Post divestiture, Yahoo will receive approximately 72.2 million Limelight shares and will own about 31.9% of the combined company.
In May 2021, Verizon had divested Verizon Media assets, which comprised iconic brands such as Yahoo and AOL, along with leading ad tech and media platform businesses, to Apollo Global in order to better focus on its core wireless business. Verizon retained a 10% ownership stake in Yahoo after the deal. Apollo Global changed the name of the content delivery network unit to Edgecast – the name by which it was known before Verizon acquired it in 2013.
Post acquisition, Limelight aims to rebrand the combined company as Edgio. With a total addressable market of approximately $40 billion, Edgio is likely to deliver significantly increased scale and a diversified revenue mix. The buyout is expected to more than double Limelight's annual revenues, with Edgecast accounting for $285 million of the combined revenues of $502 million in 2021.
In addition, Limelight’s web applications will be significantly enhanced by Edgecast's multi-layered cloud security platform, offering robust protection and enhancing developer productivity and capability for improved performance of the digital assets. The transaction is likely to yield annual cost synergies of $50 million from reduced colocation and internet-peering expenses, as well as lower operating expenses.
Moving forward, with additional fund support and investments from Apollo and Verizon, Edgio is likely to unlock significant growth opportunities and offer value addition to its shareholders.
With one of the most efficient wireless networks in the United States, Verizon deploys the latest 4G LTE Advanced technologies to deliver faster peak data speeds and capacity for customers, driven by customer-focused planning, disciplined engineering and constant strategic investments. The company remains focused on making necessary capital expenditures due to the expansion of 5G mmWave in new and existing markets, the densification of the 4G LTE wireless network to cater to huge traffic demands across multiple verticals, and the continued deployment of the fiber infrastructure.
The stock has lost 2.7% over the past year compared with the industry’s decline of 9.3%. Nevertheless, we remain impressed with the inherent growth potential of this Zacks Rank #3 (Hold) stock.
A better-ranked stock in the broader industry is Clearfield, Inc. (CLFD - Free Report) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Clearfield delivered an earnings surprise of 50.7%, on average, in the trailing four quarters. Earnings estimates for the current year for the stock have moved up 102.7% since March 2021. Over the past year, Clearfield has gained a solid 77.7%.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
In order to tap the immense growth potential of the edge solutions market and develop a powerful content-enabled firm with a global scale of operations, Yahoo has decided to divest Edgecast Inc. to Limelight Networks, Inc. in an all-stock deal. The transaction is likely to close in the second half of the year, subject to mandatory closing conditions and regulatory approvals.
Edgecast is a business unit of Yahoo, which is owned by funds managed by Apollo Global Management, Inc. (APO - Free Report) and Verizon Communications Inc. (VZ - Free Report) . It is a leading provider of edge security, content delivery and video streaming services, with a dedicated team of domain experts. Post divestiture, Yahoo will receive approximately 72.2 million Limelight shares and will own about 31.9% of the combined company.
In May 2021, Verizon had divested Verizon Media assets, which comprised iconic brands such as Yahoo and AOL, along with leading ad tech and media platform businesses, to Apollo Global in order to better focus on its core wireless business. Verizon retained a 10% ownership stake in Yahoo after the deal. Apollo Global changed the name of the content delivery network unit to Edgecast – the name by which it was known before Verizon acquired it in 2013.
Post acquisition, Limelight aims to rebrand the combined company as Edgio. With a total addressable market of approximately $40 billion, Edgio is likely to deliver significantly increased scale and a diversified revenue mix. The buyout is expected to more than double Limelight's annual revenues, with Edgecast accounting for $285 million of the combined revenues of $502 million in 2021.
In addition, Limelight’s web applications will be significantly enhanced by Edgecast's multi-layered cloud security platform, offering robust protection and enhancing developer productivity and capability for improved performance of the digital assets. The transaction is likely to yield annual cost synergies of $50 million from reduced colocation and internet-peering expenses, as well as lower operating expenses.
Moving forward, with additional fund support and investments from Apollo and Verizon, Edgio is likely to unlock significant growth opportunities and offer value addition to its shareholders.
With one of the most efficient wireless networks in the United States, Verizon deploys the latest 4G LTE Advanced technologies to deliver faster peak data speeds and capacity for customers, driven by customer-focused planning, disciplined engineering and constant strategic investments. The company remains focused on making necessary capital expenditures due to the expansion of 5G mmWave in new and existing markets, the densification of the 4G LTE wireless network to cater to huge traffic demands across multiple verticals, and the continued deployment of the fiber infrastructure.
The stock has lost 2.7% over the past year compared with the industry’s decline of 9.3%. Nevertheless, we remain impressed with the inherent growth potential of this Zacks Rank #3 (Hold) stock.
A better-ranked stock in the broader industry is Clearfield, Inc. (CLFD - Free Report) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Clearfield delivered an earnings surprise of 50.7%, on average, in the trailing four quarters. Earnings estimates for the current year for the stock have moved up 102.7% since March 2021. Over the past year, Clearfield has gained a solid 77.7%.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
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