Yahoo has officially named PayPal President Scott Thompson as its new chief executive officer, ending a four-month long search to replace the famously outspoken Carol Bartz, who was fired in September after the company's board grew impatient with her attempts to turn around the company during her two and a half years on the job.

He will take command on January 9, also joining as part of the board, which is reviewing the company's future strategy. According to recent reports, Yahoo has considered shedding some of its valuable stakes in Asian Internet companies and potentially sell a minority stake in Yahoo to private-equity investors. Tim Morse, who had been serving as interim CEO since Batz's ouster, will return to his post as CFO.

Scott Thompson has served as president of PayPal, eBay's online payment service and the company's fastest growing division, since January 2008. He previously served as PayPal's senior vice president and chief technology officer. In announcing the news Yahoo noted:

"Under his leadership, PayPal solidified its lead as the global online payment service, expanding its user base from 50 million to more than 104 million active users in 190 countries worldwide, increasing the number of merchant partners to more than 8 million globally, and growing revenues from $1.8 billion to $4+ billion in 2011."

Turning Yahoo around will be anything but an easy task, though. The company has been losing ground in the Internet advertising business to Google and Facebook for a few years now. They famously turned down a $46 billion acquisition offer form Microsoft in 2008 – at a 62% premium, mind you – and have floundered ever since. Today the company is valued well under half of what Microsoft was willing to pay in 2008.

Carol Bartz was hired in 2009 to replace co-founder Jerry Yang after being severely criticized by investors for his handling of the Microsoft bid. She shifted the company from traditional search results to more personalized content and later agreed to an advertising and search partnership with Microsoft.