Verizon Getting 7% Discount on Yahoo After Massive Hacks

The deal, now worth $4.48B, is still on
By Michael Harthorne,  Newser Staff
Posted Feb 21, 2017 1:48 PM CST
Verizon Getting 7% Discount on Yahoo After Massive Hacks
Verizon is getting a 7% discount on its purchase of Yahoo after the latter revealed massive data breaches that resulted in the information of more than a billion users being stolen.   (AP Photo/Elise Amendola, File)

Seven months ago, Verizon agreed to buy Yahoo for $4.83 billion, the AP reports. Since then, Yahoo has revealed itself to have been the victim of the two biggest data breaches ever, resulting in information from more than a billion users being stolen. According to the Washington Post, experts expected Verizon to demand Yahoo knock billions off the purchase price or to simply call off the deal entirely. But on Tuesday, the companies announced the deal was going through—at a comparatively minor 7% discount. Verizon will now purchase Yahoo for $4.48 billion, the Wall Street Journal reports. What's left of Yahoo after the sale—an entity to be known as Altaba—will split liability with Verizon for any future lawsuits that result from the Yahoo data breaches. Altaba alone will be responsible for whatever happens with an ongoing SEC investigation into the hacks.

Sources say Verizon went through with the deal at a minor discount for multiple reasons. One, Verizon has a ton of money and a few billion dollars weren't going to make a difference to it. Two, Verizon says the number of Yahoo users who left following the hacks was "minimal." Verizon is basically buying Yahoo in order to advertise to users on its news and sports sites, Tumblr, and Flickr; if a bunch of Yahoo users fled the service, Verizon would have fewer people to advertise to. Verizon, which already owns AOL and hopes to compete with Facebook and Google, wants to close the deal by the end of April. (Read more Verizon stories.)

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