AT&T, Verizon, Time Inc. and other suitors are thinking about bids for beleaguered Yahoo. And some advisors to these companies are ripe with reasons why Yahoo, battered as it is, could make an attractive target.
The two most common reasons I am hearing are that Yahoo and its dwindling user base will help “build out their online presence” or (a similar reason) “build out their vertical stack.” The stack here refers to ownership of both distribution and content.
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Smart dealmakers know that’s bogus. Here Apple could serve a lesson. While many have criticized the company’s lack of M&A as a sign it’s too insular, I’ve always viewed its caution as a strength. When you know how you make money, and it’s working, the choice to focus on the core business is obvious.
Other companies should have the same confidence, even in these times.
Slack Community.The best deals strengthen a company’s core business. The reason is simple: Organizations act in their self-interest; it is how they make money and keep growing.
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