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Not every merger is profitable---yahoo to close Geocities

Being in the merger and acquisition business, we are very sensitive to international mergers, both public and private companies.

Yesterday, Yahoo announced that it will shutdown the free webhosting service--Geocities.

Yahoo acquired Geocities for $3 Billion back in 1999 but they never figure out a make-sense business model for this acquisition. I know they will have to close down this service but I am surprised that they made the decision this late.

Merger&Acquisition is a very complicated thing. Other than emotional and ego type of M&A (companies made M&A not because of any M&A reasons), M&A is just a first step. A company will not make money for anybody unless it is taken really good care of.

From Day 1 when Geocities was purchased, its business model has stayed the same. And this very business model is NO business model. (end)

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Posted by Huiting Zhuang,Sell your business overseas on 04/24/2009 02:31 PM

Comments (3)

Originally posted at: Huiting's Blog: Not every merger is profitable---yahoo to close Geocities

Post is included in group: Merger & Acquisition Professionals
Post is included in group: merger, acquisition and crebbers

3 Comments on Not every merger is profitable---yahoo to close Geocities

APR

I saw Fred Wilson comment on this over on his site at www.avc.com He was one of the initial investors and I believe he sold it to Yahoo but I cant remember the story now. Anyways its strange to see such a big investment fail. I saw they shut down another service as well.

Yes, it is very strange. The rule of thumb "too big to fail" has failed so many times recently.

MAY

There are so many mergers and acquisitions that haven't worked out in the last decade. Maybe everyone was trying so hard to make money the easy way that they forgot how to make money, period.

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