Investors heaved a sigh of relief after the Verizon and yahoo Deal did not fall and Verizon agreed to continue the agreement albeit with some deductions. However, it will be leaving some legal liabilities behind. So the deal is well on track, and Verizon is purchasing the internet business interests of Yahoo after it slashed its core internet business by $350 million.
Hectic negotiations and a climb-down by Yahoo
The deal was finally signed on Sunday after hectic negotiations which involved discussions between Yahoo CEO Marissa Mayer, Verizon CEO Lowell McAdam and Yahoo director Tom McInerney in New York.
The deal gets Verizon access to more than a billion Yahoo users, and it will integrate its AOL with the advertising tools, search and e-mail assets of the Search Engine.
The deal is worth $4.4 billion in 2015. The deal had a positive effect on the shares of both the companies with Verizon shares increasing by 0.3% to stand at $49.33 while Yahoo’s shares rose 0.8 % to stand at $45.48.
Epic Cyber attack and massive security breach
Yahoo had announced in September that it suffered two cyber attacks, one in 2014 which compromised 500 user accounts and a more severe attack in 2013 where more than a billion user accounts were compromised. Yahoo is facing more than 24 criminal probes and lawsuits related to the cyber attacks.
Verizon knocks $350M off Yahoo sale after data breaches, now valued at $4.48B https://t.co/whNFybt7ZA
— TechCrunch (@TechCrunch) February 21, 2017
Yahoo is taking remedial measures to contain the security breach and said that 90% of the regular users have taken corrective measures or does not to do it after steps initiated by Yahoo.
As of 2016, Yahoo is thought to have more than a billion users, and 650 million are connecting from mobile devices.
BREAKING: Verizon, Yahoo agree to split future liabilities over data breaches and cut merger price by $350M - DJ
— CNBC Now (@CNBCnow) February 21, 2017
Investigation still on, Yahoo not off the hook
The investigation is on into whether there was any criminal negligence on the part of the Internet player of not informing its users as soon as the breach was discovered.
As per US laws, such breaches must be declared immediately. Companies often delay such disclosures to limit negative impacts on its shares.
Yahoo has been facing criticisms for its archaic infrastructure which was never suited for modern times. Skeptics wonder that with 1 billion accounts compromised, it’s a wonder anyone uses the service at al
