We heard rumblings last week that Verizon was close to sealing a deal to acquire Yahoo, but this morning the two companies have made it official. The purchase price is $4.83 billion, which is about as was expected because last week’s report indicated that the price they were discussing was close to $5 billion. Verizon will pay for the acquisition all in cash.

Yahoo Buy Verizon Deal

What’s in and what’s out of the Verizon – Yahoo deal?

In a press release, Verizon said it will acquire Yahoo’s operating assets. The company said it will integrate the search giant with AOL under the leadership of Executive Vice President Marni Walden and AOL Chief Executive Tim Armstrong. Verizon management expects the acquisition to place it in “a highly competitive position as a top global mobile media company.” They also expect Yahoo to help them accelerate their digital ad revenue stream. After the combination, AOL and Yahoo will hold more than 25 brands within its portfolio.

The transaction doesn’t include Yahoo’s cash, its stake in Alibaba or Yahoo Japan, its convertible notes, some minority investments or non-core patents, referred to as its Excalibur portfolio. Yahoo will retain control over those assets and then change its name when the deal closes. At the time of closing, Yahoo will become a registered, publicly traded investment firm.

“Yahoo is a company that has changed the world, and will continue to do so through this combination with Verizon and AOL,” said Yahoo CEO Marissa Mayer in a statement. ?The sale of our operating business, which effectively separates our Asian asset equity stakes, is an important step in our plan to unlock shareholder value for Yahoo. This transaction also sets up a great opportunity for Yahoo to build further distribution and accelerate our work in mobile, video, native advertising and social.”

Yahoo to return cash

Yahoo plans to return almost all of its net cash to shareholders and will release the details on a strategy for returning that capital at some point before the transaction closes. Verizon and Yahoo expect the deal to close in the first quarter of 2017, putting an end to a saga that dragged on for months, beginning with Yahoo’s failed plan to spin out its stakes in Alibaba and Yahoo Japan.

The company will keep operating independently until the closing. Verizon will create cash-settled restricted stock units in exchange for outstanding Yahoo restricted stock units at the time of closing.

Shares of Yahoo declined after the deal was announced, falling by more than 1% to as low as $38.90.