Marissa Mayer will resign as the CEO of Yahoo when Verizon finally completes its acquisition of the company's web portal, search engine, email service and news services.
Verizon will merge the Yahoo-branded web properties with AOL, which includes advertising sales platforms and websites such as The Huffington Post, TechCrunch and Engadget.
Mayer, one of the highest paid CEOs in the S&P 500 index of the biggest companies in the US, will walk away with an estimated $55m as a pay-off.
The non-Yahoo remains of the company, which Verizon isn't taking over, will be renamed "Altaba". Mayer - and five others - will resign from the board at the same time.
The company will continue to operate as an investment company under the US Investment Company Act of 1940 after Verizon has finally signed on the dotted line.
The remaining parts of Yahoo will consist of its 16 per cent stake in Chinese ecommerce website Alibaba, which is worth around $30bn; a 36 per cent stake in Yahoo Japan, where the Yahoo brand remains popular and Yahoo's stake is valued at about $8.6bn; and, a portfolio of patents that the company attempted to sell for around $1bn in the summer, but which failed to drum-up sufficient interest.
Part of the reason for that is that pinning a value on the portfolio is particularly difficult, especially with a lot of ageing patents from the 1990s, which may well be contestable if asserted.
The news is contained in a filing with the US stock market regulator, the Securities and Exchange Commission.
The filing indicates that Verizon is on course to complete the acquisition, despite frequent suggestions that it may pull out or haggle over the price following a series of security disclosures.
The company, one of the first big internet companies of the 1990s dot-com boom, made a series of mistakes as it faded alongside nimbler and arguably smarter start-ups, including Google, Instagram, Facebook and Skype.
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