Verizon Drops $350 Million From Offer to Buy Yahoo Because of Data Breaches
When Yahoo disclosed last year that hackers had compromised 1.5 billion email accounts, Verizon saw a silver lining in the cloud over its offer to buy the company. Let's make that about $350 million worth of silver lining.
Verizon had offered to pay $4.8 billion for Yahoo's core internet business before the data breaches were discovered, but now the parties have agreed to $4.48 billion. According to reports, the deal will go to shareholders for approval in April.
"We have always believed this acquisition makes strategic sense," said Verizon's Marni M. Walden. "We look forward to moving ahead expeditiously so that we can quickly welcome Yahoo's tremendous talent and assets into our expanding portfolio in the digital advertising space."
Could Be the Biggest Hack Ever
Yahoo suffered two massive data breaches in 2013 and 2014, but didn't know about them until last year. The company announced 500,000 accounts were affected in September and another billion in December. They are the largest known hacks of a private corporation to date.
User names, email addresses, telephone numbers, dates of birth and passwords were stolen. The company's chief information security officer Bob Lord said they may be connected to a foreign government.
"We have connected some of this activity to the same state-sponsored actor believed to be responsible for the data theft the company disclosed on September 22, 2016," he said at time.
Might Have Been the Biggest Discount, Too
Reports of the breach led to concerns that Verizon would pull out of the deal or seek a big discount. At least one media outlet speculated Verizon would reduce its offer by $1 billion.
In announcing the settlement, the companies did not the details about the negotiations. However, representatives said they will share liability for the data breaches.
Yahoo faces scores of lawsuits from the theft of its user data. Complaints range from invasion of privacy to securities violations.
- Yahoo Hit with Data Breach Class Action Lawsuit Claiming Credit Card Details Stolen (Silicon Beat)
- California's Rights to Privacy and Compliance Programs (FindLaw's InHouse)
- Can You Change a Culture Like Uber's? (FindLaw's InHouse)
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