Verizon has officially announced a $350 million reduction to the price it will pay for Yahoo’s consumer business. The cut follows the disclosure of two security breaches at Yahoo in recent years.
Bloomberg reported the lower offer last week, additionally claiming that both parties in the deals are expected to share legal responsibilities related to the cyber breaches. This turned out to be true. Going forward Altaba, a sort of zombie holding company that will retain Yahoo’s very valuable holdings in China and Japan, will share responsibility from any future costs that may arise out of the hacks.
Verizon announced plans in July of last year to acquire Yahoo for $4.83 billion. The company said that Yahoo would be integrated with AOL, which Verizon purchased in June 2015 for $4.4 billion. Just a few months later, the purchase appeared to be jeopardized by Yahoo’s disclosure of two large data breaches.
In September 2016, Yahoo released information about a 2014 hack that affected at least 500 million accounts. A similar revelation followed in December of last year, when Yahoo stated that a separate security breach in August 2013 had exposed the names, emails, and hashed passwords of more than a billion users. After news of the second major hack, Verizon reportedly began exploring options of either reducing the acquisition’s price tag or abandoning the deal entirely.