Yahoo Hires PayPal’s President Scott Thompson as CEO

Yahoo in a surprise move has appointed Scott Thompson the former president of Ebay backed PayPal as its new CEO. First on his agenda is to complete a strategic review of the Internet giant’s operations and reverse a growth slide that saw the expulsion of former CEO Carol Bartz. Thompson will take over the reins beginning January 9, said Yahoo in its statement.

Thompson in the days to come will mull over the options available that include a divestment plan of Yahoo’s Asian assets and sell a part of the company to private equity firms, but a contrary opinion is that the appointment quells rumors of a sell-out. His background of online payments is not befitting to lead a company that thrives on advertising to compete with the likes of Facebook and Google, noted Evercore Partners Inc.

Yahoo Chairman Roy Bostock clearly stated that he had no plans of taking Yahoo private and his goal was to increase revenue and put the company back in the pantheon of innovation. Amidst the announcement, Yahoo shares fell 2.6% to $15.86 at around 1:30 pm New York Time, the stock saw 3% deprecation last year.

John Donahoe will function as PayPal interim chief working closely with the PayPal leadership team, said John Pluhowski, an EBay spokesman. As PayPal’s president, Thompson increased the consumer base to more than 100 Million and was on track to achieve a target of $7 Billion in revenues by 2013.

Thompson is expected to extract the most out of Yahoo’s International assets, which include a 40% percent stake in Alibaba Group Holding Ltd; a Chinese e-commerce company and Yahoo! Japan Corp. Yahoo’s core competency remains the Internet portal business, managing which will be Thompson’s biggest challenge.

Thompson’s predecessor Bartz had failed to achieve targets and was woefully falling short of projections, which, ultimately saw him being fired over the phone my Mr. Bostock, in September.

Yahoo is trying to tap into the raging mobile phone market including tablets and smart phones. “The intention that we have is we will be great across all devices, mobile is a wave that’s bigger than people can even imagine it to be.” He said via conference call.

In concluding remarks, he mentioned his aspiration to work with a top notch digital media company. “This company, long before I arrived, had the aspiration of being the premium digital media company,” “I would not come if I didn’t believe the future.” He said.

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