Spinoff Odds & Ends – GreatLand Connections, Yahoo Small Business

A few short hits for the Friday before Memorial Day –

  • A very minor footnote to the abandoned Comcast (CMCSA)/Time Warner Cable (TWC) megadeal is the cancellation of the GreatLand Connections spinoff. The spin would have shed millions of customers in select markets and was part of the two companies’ strategy to win regulatory approval. I think they need some better strategists. Given the length of the review, a lot of planning and work had gone into creating the company, including filing Form 10’s, but it was all for naught. That means a lot of lives were disrupted for nothing and this piece highlights some of that ‘people effect‘ of cancelling a spin.
  • Yahoo (YHOO) may or may not have an issue with the IRS regarding its plans to spin off its ginormous stake in Chinese e-commer giant Alibaba (BABA). In order for the spin to be kosher (at least pre-‘review’), an actual business is required to be tossed into the mix along with the shares. In this case, that will be Yahoo’s Small Business Unit and its estimated $50m of EBITDA. While potentially a great move for Yahoo shareholders, how do the actual customers of the Small Business Unit feel? This SF Gate piece takes a look at the spinoff and the numerous challenges facing it’s future leader, Amer Akhtar. He is certainly positive about its future, but it remains to be seen whether being free of Yahoo is a blessing or a death sentence. When focusing on the spinoff motives or the tax strategy, it’s often easy to forget about the actual business!

Have a great weekend!

Disclosure: Author holds shares of TWC