With reports earlier on October that Yahoo will withdrawal all its services from South Korea, the company in its 8K filing confirmed that the planned withdrawal will cost it $94million. “This decision is part of our efforts to streamline operations and focus our resources on building a stronger global business that’s set up for long-term growth and success,” read the company’s announcement from October 19. The proposed transition costs according to the company will be felt in the current quarter of business, which ends on December 31.
Here’s the full text of the 8K filing:
Costs Associated with Exit or Disposal Activities.
On October 24, 2012, the Company filed a Form 8-K to disclose that it had begun notifying employees whose employment would be terminated as a result of the Company’s plan to close its Korean business by December 31, 2012. At that time, the Company was unable to estimate the pre-tax cash and non-cash charges and total charges it expected to incur in connection with this action.
The Company now expects that it will incur pre-tax cash charges of approximately $5 million related to severance pay expenses and approximately $2 million related to lease termination charges. The Company also expects to recognize pre-tax non-cash charges related to goodwill and other asset impairments totaling approximately $87 million. The Company expects to recognize the majority of the total pre-tax charges in the quarter ending December 31, 2012. The Company is unable at this time to estimate the other contract termination charges, the amount of total cash charges or the total charges it will incur.