Seven West Media (ASX: SWM) has today completed the sale of its 50 per cent interest in Yahoo7, with American communications giant Verizon picking up the business for $21 million.
Seven now fully owns and operates all of its 'direct to consumer' digital products following the divestment of its share in Yahoo7.
When Seven announced its 1H19 results the company valued Yahoo7 at $36.1 million and suffered an impairment loss of $11.9 million.
The sale of Yahoo7 is part of Seven's attempts to compile and create a cohesive media experience across all screens according to CEO Tim Worner.
"This strategy is already working on all fronts," says Worner.
"SWM achieved its largest ever unique monthly audience of five million in February, following year on year growth of nearly 20 per cent confirming our position as one of Australia's largest and fastest growing digital publishers."
Part of this rebrand and digital realignment was the recent launch of 7NEWS.com.au which replaced the Yahoo7 site last week.
"It is already achieving larger daily online news audiences than when inside Yahoo7," says Worner.
"Similarly, Pacific and thewest.com.au are reaching record daily audiences, higher than at any time in the joint venture."
The transaction has been made with Verizon subsidiary Verizon Media. Formerly Verizon Media was known as Oath as part of a strategy by Verizon to have a global brand name.
Verizon Media is an umbrella company for Verizon's digital platforms including Yahoo!, AOL, HuffPost, EdgeCast, lurry, Weblogs.
The departure of Yahoo7 brings to a close a lengthy joint venture for the two media companies and perhaps confirms the relative irrelevance of the Yahoo brand in Australia.
Yahoo, an American web services provider, first arrived in Australia in 1997.
Seven West Media first attempted a cross-media entity with AOL in 2001, but that eventually folded in 2004 when Seven sold AOL7 to Primus Telecommunications.
The joint venture between Yahoo and Seven launched in January 2006. Yahoo7 then replaced Yahoo's Australian sites and acted as a content distribution point for both Yahoo and Seven.
Worner says the divestment of Yahoo7 will transform the media company.
"Today marks a huge milestone in the ongoing transformation of Seven," says Worner.
"In just over two years, we have radically revitalised our digital strategy. Our new products are rapidly becoming leaders in their respective markets and are now taking a meaningful share of some of the fastest growing advertising categories. And we are just getting started."
"All this puts SWM in the strongest possible position as we enter our next phase of exponential digital growth in 2019 and beyond to the Tokyo 2020 Olympics."
Since August 2018 the price of SWM shares have been slashed by over half, down from a peak of $1.10 per share on 23 August 2018.
The company's CEO Tim Worner has slowly been recovering from an embarrassing affair with his assistant Amber Harrison which generated a very public legal battle.
The company cut Worner's pay packet by $450,000 at the end of the 2016 financial year. Additionally the company reported nearly $1 billion in writedowns and one-off costs at the time.
Shares in Seven West Media are up 5.15 per cent to $0.51 per share at 1.03pm AEST.
Business News Australia
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