Data Breaches Trigger Yahoo To Slash $350 Million From Price Of Verizon Deal
Verizon and Yahoo have announced on Tuesday, February 21 that the price of sale of the core Internet business has been cut down by $350 million in order to seal the deal with Verizon. The decision was made due to the major data breaches Yahoo suffered whereas millions of users had their personal data stolen.
The deal now has its terms revised whereas the total amount of Verizon's purchase of Yahoo assets is at $4.48 billion. According to Rappler, Yahoo is still suffering from the aftermath of the massive Yahoo data breach that affected 1.5 billion accounts. As a result, the company is facing several lawsuits and probes to this day.
According to Variety, the deal between Verizon and Yahoo is expected come to a close in the second quarter of 2017. Moreover, there is also an understanding between the two companies that Yahoo will shoulder fifty percent of the costs related to the breach. That being said, it is likely that Yahoo will be financially involved with non-SEC government investigations related to the data breach and more.
In addition, the same report claims that any shareholder lawsuits and SEC investigations that may arise will still be shouldered by Yahoo and will remain their responsibility even after the deal has closed. Another notable term included in the Yahoo-Verizon deal is that the damages dealt by the data breach will not be considered when identifying a "Business material adverse effect."
Verizon EVP and president of production innovation and new businesses, Marni Walden stated in a prepared statement that the terms of the deal are meant to provide a fair and favorable outcome for the shareholders involved. Walden later added that the agreement aims to provide protection for both sides in the hopes of closing the deal in the second quarter of 2017.
Meanwhile, Marissa Mayer the CEO at Yahoo has said in her statement that they are excited to unite with Verizon and AOL. "his transaction will accelerate Yahoo's operating business especially on mobile, while effectively separating our Asian asset equity stakes."
It is worth mentioning that once the deal has been closed Yahoo will change its name to Altaba Inc. Following that, Marissa Mayer and six of the current Yahoo board members will resign from Altaba's board.