14 DAY TRIAL // Verizon was reportedly looking into shaving off $925 million off the Yahoo deal but only got to cut $350 off the final price.
We can't really blame Verizon for wanting to cut down such a huge chunk of its deal with Yahoo given how months after announcing its intention to buy the ailing Yahoo, it got served the two largest data breaches in history.
According to a filing, in February, Lowell McAdam, Verizon Chief Executive Officer, told Yahoo director Tom McInerney that they believed a $925 million price reduction could be appropriate following the damaging revelations.
Therefore, Verizon Communications sought a price reduction that's almost three times larger than what it got away with. According to the latest announcement regarding the acquisition, Verizon will pay $4.48 billion for Yahoo, down from $4.83 billion, as it was originally announced back in July 2016.
It all started back in the summer of last year when Verizon announced its plans to acquire Yahoo. As things seemed to be going great for the two companies, news came in September that a major data breach affected Yahoo back in 2014, exposing 500 million accounts, complete with passwords, contact details, security questions, and answers.
If that wasn't bad enough, December came along and brought news that Yahoo was the victim of another data breach in 2013 when 1 billion accounts were exposed to hackers.
More deal changes
While Verizon may have only obtained a fraction of the price cut it was looking for, it did manage to get some other alterations to the deal.
"Verizon and Yahoo will share certain legal and regulatory liabilities arising from certain data breaches incurred by Yahoo," read an announcement made last month.
Yahoo will be responsible for half of any cash liabilities incurred following the closing related to non-SEC government investigations, as well as third-party litigation related to the breaches. Any liabilities arising from shareholders and SEC investigations will continue to be Yahoo's responsibility.
There are currently some 43 putative consumer class action lawsuits filed against Yahoo in the United States following the data breaches. The company is also under investigation by the SEC due to its failure to announce the investors of the data breaches in a timely manner.