In July of this year Verizon agreed to acquire Yahoo for $4.8 billion. But in the months since, Yahoo has come forward to disclose not one, but two massive data breaches. In September Yahoo confirmed that 500 million accounts had been compromised, leaking names, emails, telephones numbers, and hashed passwords. Yesterday the company acknowledged a separate hack that affected over a billion users, exposing much of the same kind of information.
Now Bloomberg is reporting that Verizon has formed a legal team to explore a reduction in the purchase price or killing the deal altogether. This team is being kept separate from the group led by AOL CEO Tim Armstrong, which has been moving forward on plans to integrate the two web giants under the Verizon umbrella.
From bad to worse
Verizon hasn’t revealed much in public about how its sentiment on the acquisition may have shifted. “As we’ve said all along, we will evaluate the situation as Yahoo continues its investigation,” Verizon said in a statement. “We will review the impact of this new development before reaching any final conclusions.”
One of the key aspects of the purchase going forward, according to the Bloomberg report, will be finding a way to quarantine legal responsibility for the hacks, ensuring that only Yahoo, and not Verizon, would be vulnerable to future lawsuits. According to CNBC, the FBI is now investigating the Yahoo hack, which makes sense, given the first breach it reported was attributed to a state actor.