14 DAY TRIAL // Yahoo CEO Marissa Mayer will receive a huge "golden parachute compensation" of over $23 million after all is said and done with the Verizon acquisition of the company, unless she gets employed at Yahoo again. The payout will be a mix of cash, equity, and benefits.
"The values in this column represent the cash payments to which the executive officer would be entitled under either the Change-in-Control Plan or under the Severance Agreement, whichever is greater," reads the document, suggesting that the deal is not set in stone.
Mayer has been with the company since 2012, and since then she went on a long shopping spree, spending north of $2 billion, hoping to put the company back on track. Her plans didn't exactly work as she thought they would and Yahoo's financial status ended up being shaky at best.
The data breaches of doom
In this same period, Yahoo was affected by two data breaches - one in 2013 and one in 2014. The first affected 1 billion accounts, while the latter "only" half a billion. Both data breaches were only announced in December and September 2016, respectively, after the company had already signed the acquisition deal with Verizon.
Initially, the price of the deal was set at $4.83 billion, but following the revelations regarding the data breaches, Verizon wanted to shave $925 million off. In the end, they managed to bring down Yahoo's price to $4.48 billion, $350 million less than originally agreed upon. That's pocket change compared to what Yahoo used to be worth, namely north of $100 billion more than a decade ago. There was also a $44 billion acquisition offer from Microsoft back in 2008, which they declined.
While data breaches happen to almost every company out there, immediate disclosure, security updates, and a full investigation are things that can make a difference between users trusting that company again or not.
Not only were Yahoo's data breaches the largest in history, they were also late to acknowledge the problem. "The train has left the station" - late. In fact, recently revealed documents indicate that high-level executives knew about the 2014 data breach since late that year. While Mayer's name is not mentioned in the files, it's hard to believe the company's CEO knew nothing about the incident. Doing just a little bit of math tells us that they took about two years to reveal the data breach to users.
What happened in those two years? People's accounts were put at risk. Users did not change their passwords to protect their accounts; they did not change their security passwords, they likely used those same passwords for other accounts too, because that's something that happens so often. Two years during which Yahoo failed its users.
Golden severance package
And yet, Mayer will be getting a $23 million "golden parachute" after the Yahoo - Verizon deal is done. During her time as Yahoo CEO, Mayer has been compensated over $150 million. She did give up her latest annual bonus and equity stock so it could be distributed to Yahoo employees as a "thank you" for their work, though.
Of course, Mayer will not be getting the $23 million if Verizon chooses to hire her after the sale, but at this point, that doesn't really seem likely.
What's left of Yahoo after the Verizon deal will be spun off into Altaba, and it's already been announced that she won't be joining that company. In fact, Thomas McInerney will be the one who takes over as CEO for that company.