Bloomberg's Sherman on the Favored Bidders for Yahoo (Audio)

next on taking stock. But right now, let's go to Charlie Kellton and the the Bloomberg Looser or Bloomberg Business Flag, and I thank you pim Fox. Just getting word of a change in the location of the September twenty six presidential debate. It is being moved to Hofstra on Long

Island outside of New York from Right State. Right State pulling out of hosting the debate after security costs rose from three and a half million dollars to over eight million dollars, so that September twenty six presidential debate will be held on Long Island. SMP five hundred index is lower than dal higher NESDAK is lower as well, following a mix of corporate earnings reports, the recent run up for equities hitting some headwinds. Today, Netflix tumbling UH thirteen

point five percent after subscriber growth disappointed. Also Johnson and Johnson providing some offset. It shares higher now by one point four percent after quarterly profit beat estimates. John Mantley is chief executive chief equity strategist, I should say at Wells Fargo Funds Management. He was interviewed about the big picture for earnings and markets this morning on Bloomberg Television. I think we're moving higher now. Again. I tend to be too optimistic. It's my nature, so I should come

with a warning tag. But I think what's happening. He's earnings are starting. Earning has been flat to earnings are starting to get better. I think after you call it an intercession, I think it was just sideways are in slightly down, not particularly great, not particularly bad. But I think that's starting to get better. And if that does get better, if earnings get better and we see new highs and earnings, I think the market can finally get

excited about something. A person familiar where the matter says us Anti Trust officials are poised to follow lawsuits to block Anthems takeover of rival health insurer Signa and Etna d ETNAS deal to buy Humana again. According to a person familiar with the matter, we will have more on

the story coming up. On taking Stock the now up six points now a gain of less than point one percent, SMP down three tenths of long percent, Gold up three dollars the ounce, the thirteen thirty two a gain of point two percent, and two thirty two on Wall Street to look at the other stories making news. Thank you Charlie from the Bloomberg newsroom. I'm Jill Schneider. This news update is brought to you by Audie. Is it a

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do that. Your word is your bonds, and you do what you say. Governor Chris Christie declared not a three percent of the speech is completely different, while GEO pe Chrman Bryant's previous tells Bloomberg that can be explained. These are basic seems commonly used. On CNN, Trump campaign manager Paul Metaphort goes further blaming the Clinton campaign. This is once again an example of when a woman threatened Hillary

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the demonstrations have been peaceful. We want to make sure that people understand peaceful, non violent, which is what we've had so far, and we want to keep it that way. Governor Andrew Cuomo is unveiling designs for New York City subway cars with wider doors, WiFi and phone charging stations. The twenty seven billion dollar plan calls for new and upgraded subway cars and busses, better control technology, and redesigned

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Box on Bloomberg Radio. Yahoo. Yahoo said that its revenue in the second quarter fell fifteen percent. It's operating profit fell sixtent. The company also acknowledge that Tumbler, this is the biggest acquisition under its current chief executive Marissa Mayram, was now worth only a third of the one point one billion dollars that Yahoo paid for it in twent thirteen. For more on Yahoo, I want to bring It. Alex Sherman, Bloomberg News, m and a reporter focusing on technology, media,

and telecoms. He can be followed on Twitter at Sherman four nine four nine all right, Sherman four nine for nine tell us about the numbers when it comes to Yahoo, like no one, No one really cares about the numbers anymore, PIM. Because this company is for sale. This will be Marrissa

Meyer's last earnings call where Yahoo is an independent company. UH, at least in terms of you know, it'll be announced that the deal'll have to close, so she she may stick around for one or two more, but this will be the last one where there's no buyer for Yahoo. Unless something really, really surprising happens. We should have UH an idea or or in fact, an announcement of who buys Yahoo within the next week or so. Final bids were due yesterday. Verizon is a likely buyer of Yahoo. UH.

Dan Gilbert's Quicken loans as a possible buyer. UH. A private equity firm called Vector Capital is still in the mix. UH, TPG and a t T also made bids. Those are the five. They're a little less likely UH to win as far as the sources that I have spoken to, But Yahoo is UH is not a good business these days. Him. Uh, it's it took a four eight two million dollar uh impairment charge for Tumbler, as you alluded to. That was Marissa Meyers, really her biggest deal, and during her tenure

that yeah, who acquired that in Uh. You know, revenue continues to sort of bump along. The Yahoo posted revenue of one point three billion, that's up five percent year over year, but earnings are down. They're down about forty three percent per share from a year ago. And it's tough when a company is going through a very well publicized sale process us to motivate employees and to keep

customers happy. And Yahoo has struggled. Yahoo has struggled. I wonder if you just go back to that Tumbler acquisition just for a moment. One point one billion dollars of shareholder money, right, this is not this is shareholder money. This is this is money that is owed to the shareholders. And it seems nobody cares that they're going to write off like two thirds of the entire purchase. Yeah. The reason I think no one cares is that Yahoo has traded as basically a stub for Ali Baba uh for

years now. So yeah. In other words, if you look at Yahoo, whether it goes up or down on a given day with the market, it is almost always in line with whether Ali Baba moves up or down. So the Yahoo business in fact is actually worth zero uh. If you calculate sort of the some of the parts analysis, the market gives Yahoo business no worth whatsoever, which is part of the reason why Yahoo is actually selling its

core business right now. Marissa Mayer realized is that if you want to maximize share holder value, we have to sell this thing for at least a few billion dollars because we're not getting credit for any of it right now. So Yahoo is made up of a steak in Ali Baba, a minority steak in Ali Baba, a steak in Yahoo Japan. Uh soft Bank owns the majority of the rest of Yahoo Japan, and then the Yahoo core business. So these

three parts of make up Yahoo total. The Yahoo core business is only worth about four billion dollars or so uh. You know, the Yahoo steak in and Yahoo Japan is worth about seven and nine billion dollars depending on when you look. Uh. And then the rest of Yahoo's worth is all in Ali Baba, which is a lot more alright, So just one one last point question for you here, Alex Sherman. Um the longer that this all takes to resolve itself, what happens those businesses? Do they just die

on the vine? It's not like there's not a lot of competition that's out there doing what they're supposed to be doing every day. Yeah, it's a great question, and I think it will depend on who the buyer is here, so soon we get an announcement within the next week or so. Each buyer has its own plan for Yahoo. So you know, if TPG, which is a private equity firm, buys Yahoo, you can expect some of those businesses to die on the vine. Uh. They they will, you know,

do what a typical private equity firm does. They'll slash and burn, they'll fire people, they'll shut down businesses. Uh and and they'll sell off parts that they don't want. If Verizon buys it, some of those businesses may stick around for a little while longer because you can just merge Yahoo in a o L uh in a o L provides some uh that run by Tim Armstrong, still within Verizon, run some businesses that are sort of symbiotic

to Yahoo. So some of that, some of the content plays, and some of the ad technology that Yahoo has can theoretically be merged with a O L And so some of the employees there may live to see another day. Tell us about soft Bank and the deal to buy ARM Holdings. So this one is a little bit of a surprise in terms of who the buyer is. Uh uh arm You know, is this chip licensing their chip designer, chip designer exactly. They don't actually make intellectual intellectual property,

so Softing is not a semi connector company. So in terms of a buyer, you might think, oh, that's a little weird Softing because this Japanese wireless provider that owns or so of sprint in this country. So the idea that they want to buy a chip designer is a little out of the box. That's it. For regulatory reasons, it's a little harder for someone in the game to actually buy ARMED that the deal would likely be nixed by regulators. So if someone wanted to do this, it

might have to be somebody out of the box. And Masasan is a three year plan for soft Bank. It's a bet on the Internet of things. That's really why he did this, thanks very much. Alex Sherman Technology media, telecom, mergers and acquisitions reporter for Bloomberg News. You can follow him on Twitter at Sherman for nine for nine, this

is Bloomberg, coming up on taking stock. Steve Hefner, chief executive co founder of the travel site Kayak, gives us his thoughts on Ezeka and the Olympics in Brazil.