May 16, 2022 Last Updated 01:02 AM EDT
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Feb 27, 2017 08:59 PM EST
Verizon and Yahoo have entered and signed an agreement that cuts the original $4.83 billion acquisition price for Yahoo by $350 million. The deal comes months after Yahoo had been hit by two massive cyber-attacks.
Under the new terms of the deal, Verizon and Yahoo will split the cost of lawsuits arising from the data breaches. Yahoo is reportedly under investigation by the United States Securities and Exchange Commission for potentially taking too long to inform the company's investors about the breaches. But Verizon has not lost faith in Yahoo's one billion active users and believes the acquisition still makes strategic sense.
"We look forward to moving ahead expeditiously so that we can quickly welcome Yahoo's tremendous talent and assets into our expanding portfolio in the digital advertising space," Marni Walden, Verizon's executive vice president, said in a statement. Verizon wants to incorporate Yahoo's mobile video and advertising tools with its AOL unit. Verizon sees this as sources of revenue outside a crowded telecoms market in the US.
The acquisition is part of Verizon's strategy to boost its digital advertising as it competes with search engine site Google and social media giant Facebook. Verizon's push to purchase Yahoo's operating business was delayed after its breach revelations but is apparently moving on again. "It is an important step to unlock shareholder value for Yahoo, and we can now move forward with confidence and certainty," Yahoo CEO Marissa Mayer said in a statement.
Further to the revised deal, Yahoo and Verizon will be responsible 50 percent each of any liabilities arising from any investigations and third party litigation related to the data breaches. Yahoo will be solely responsible for any liabilities arising from shareholder lawsuits and Securities and Exchange Commission investigations. Walden said the agreement provides a fair and favorable outcome for shareholders.
