Verizon lowered price in Yahoo deal

Verizon lowered price in Yahoo dealVerizon Communications Inc. will acquire Yahoo! Inc.’s Internet properties at a $350 million discount after revelations of security breaches at the web company, according to Bloomberg on Tuesday.

The acquisition, now valued at $4.48 billion in cash, is expected to close in the second quarter, the companies said in a statement Tuesday. In addition to the price cut, Verizon and the entity that remains of Yahoo after the deal, to be renamed Altaba Inc., will share any ongoing legal responsibilities related to the breaches.

The move brings Verizon another step closer to adding Yahoo and its billion users as it tries to expand beyond a maturing wireless and landline business into mobile media and advertising ventures.

The revised terms provide a “fair and favorable outcome” for shareholders, said Marni Walden, Verizon’s executive vice president and president of product innovation and new businesses.

“It provides protections for both sides and delivers a clear path to close the transaction in the second quarter,” she said.

Last month, Yahoo said the sale would be delayed to the second quarter as the company assesses the impact from the breaches and meets closing conditions. The deal was first announced in July and had been set to wrap in the first quarter of 2017.

Yahoo Chief Executive Officer Marissa Mayer has been under pressure to conclude the deal. Her failure to turn around the company led to a bidding process that Verizon won in July. Mayer was running the company when both of the hacks took place.

The attacks on Yahoo’s system have sparked concerns from regulators and prompted lawsuits. In November, the company said it was cooperating with federal, state, and foreign governmental officials and agencies seeking information about the 2014 hack, including the U.S. Federal Trade Commission and the U.S. Securities and Exchange Commission. In December, following the admission of a second hack, a White House spokesman said the Federal Bureau of Investigation was probing the Yahoo hack as well.

Under the amended terms, the data breaches or losses won’t be taken into account in determining whether a “business material adverse effect” has occurred or whether certain closing conditions have been satisfied.
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