Verizon announced this summer plans to buy Yahoo for $4.83 million. Since then, Yahoo had to acknowledge two major security breaches that may now cost it the huge Verizon deal.
In September, Yahoo said that hackers stole details for 500 million accounts in 2014. Earlier this week, Yahoo stated that a different security breach dating back to August 2013 allowed unknown attackers to obtain sensitive personal data for more than 1 billion accounts.
According to reports from Bloomberg and Reuters, Verizon is now reconsidering the deal with Yahoo. Verizon is still expected to go through with the deal, but it wants a price cut following these massive cyber attacks.
A person familiar with the situation told Reuters that Verizon is looking for “major concessions” from Yahoo.
Yahoo, meanwhile, is seeking to go forward with the deal. “We are confident in Yahoo’s value, and we continue to work towards integration with Verizon,” a spokesperson told Reuters.
Verizon is under pressure from shareholders to reassess the value of the deal, with Yahoo seen as damaged goods, Bloomberg says.
“As we’ve said all along, we will evaluate the situation as Yahoo continues its investigation,” Verizon told the news site in a statement. “We will review the impact of this new development before reaching any final conclusions.”
Verizon’s General Counsel Craig Silliman is leading a legal team that’s assessing the damage from the breaches. The findings of this team should help Verizon either kill the deal or renegotiate a lower price for the purchase. Verizon is looking to have Yahoo assume any responsibility and the future fallout from the breaches.
Yahoo was already hit with a class-action lawsuit following the disclosure of the latest hack.
“Yahoo failed, and continues to fail, to provide adequate protection of its users’ personal and confidential information,’’ Yahoo user Amy Vail said in the lawsuit. “Yahoo users’ personal and private information has been repeatedly compromised and remains vulnerable.’’
The deal should be finalized in the first quarter of 2017, assuming Verizon and Yahoo go forward with it.