Report: Bids for Yahoo expected to be in the range of $2B to $3B, far below initial expectations

Yahoo's auction of its core internet business could see bids in the range of $2 billion to $3 billion, far below previous predictions that the assets would fetch as much as $8 billion, according to The Wall Street Journal.

Verizon has repeatedly acknowledged that it is interested in acquiring Yahoo's online business, and a Reuters report last month said the nation's largest wireless operator was "the clear favorite" to walk away with the assets at auction. Verizon remains the front-runner and is expected to bid between $2 billion and $3 billion, according to the Journal, while others "are expected to bid in the low end of that range," according to unnamed people familiar with the matter.

Yahoo began accepting bids for at least some of its internet assets last month and has reportedly set a deadline in the first week of June for the next round of bids. The recent sagging interest follows weeks of sales presentations by Yahoo and the company's disclosure of disappointing financial data.

The Journal reported revenue from Yahoo's mobile, video and social ads rose only 6.8 percent year-over-year in the first quarter of 2016, continuing a dramatic slide in crucial areas. Those segments saw 26 percent year-over-year growth in the fourth quarter of last year, 43 percent growth in the third quarter and 60 percent growth in the second quarter.

But Yahoo still appears to be a good fit for Verizon, which is moving aggressively to build a media and advertising empire alongside its telecom businesses. Verizon acquired AOL last year for $4.4 billion in a deal that included properties such as Engadget, The Huffington Post and TechCrunch, and it has been outspoken about its plans to monetize Go90 and other media channels through advertising.

A small handful of other bidders remain interested in Yahoo including the buyout firm TPG and an investor consortium including Bain Capital, Vista Equity Partners and former Yahoo CEO Ross Levinsohn, according to reports.

As the clock winds down on Yahoo's auction, it appears Verizon may be able to add to its growing media business for far less money that was once predicted. But the low bids may instead prompt Yahoo to abort the sale and continue to try to turn things around on its own.

For more:
- see this Wall Street Journal report

Related articles:
Verizon well positioned as deadline arrives for Yahoo bids
Verizon the 'clear favorite' to win Yahoo's online assets
Barclays: Verizon and Yahoo 'not an inconceivable combination'
Verizon CEO confirms interest in acquiring Yahoo's assets
Yahoo to slash jobs and bet on mobile search as it looks for a suitor
Verizon on hold as Yahoo reportedly plans to lay out strategic vision

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