Yahoo Inc. is sitting on $9.4 billion in cash after selling its stake in Chinese Internet company Alibaba Group. About $5.5 billion has been earmarked for paying the tax bill on the Alibaba deal and buying back Yahoo stock to bolster its stock price and earnings per share.
But that still leaves recently hired CEO Marissa Mayer with plenty of firepower to finance acquisitions if she identifies technology or products that might help her create more compelling Internet services and sell more online advertising. On Monday, she provided some insights into the kinds of deals that she might make during a conference call held to discuss Yahoo's third-quarter earnings.
QUESTION: Can you give us some acquisition guidelines.
ANSWER: We don't have particular acquisitions in mind today. We do need the flexibility where if we see something that aligns well with our business and provides terrific growth that we can make that acquisition. That's what I think is one of the things that is lost on people. Because so many of the high-profile tech acquisitions are above the billion-dollar mark, people tend to think that tech acquisitions are all in that space, and that's just not the case. Many acquisitions, and most acquisitions, a vast majority are less than $100 million.
And, so, we're looking for smaller-scale acquisitions that align well overall with our businesses. In my history and in my career, I've done about 20 or so such acquisitions...I think that the size and scale that's comfortable for a great integration and a great product coming out of it is something that's much more in the size and scale of, you know, double-digit millions and low hundreds of millions.