Verizon Asks $1B Discount On Yahoo
Verizon is now pushing a $1 billion off its pending $4.8 billion agreement to buy Yahoo.
Yahoo revealed and said that two weeks ago it had been hacked in 2014 and because of that username and passwords for 500 million account were swiped.
At the time, Verizon had learned about breach two days before Yahoo disclosed it publicly.
Tim Armstrong, the head of the AOL, which Verizon acquired in 2015, reportedly has met with Yahoo executives about reducing the acquisition price. He said "He's pretty upset about the lack of disclosure and he's saying, can we get out of this or can we reduce the price?"
The discount is being pushed because it feels Yahoo value have been diminished.
AOL/Yahoo will reach about 1 billion consumers if the deal closes in the first quarter, with a stated goal to reach with 2 billion by 2020.
Yahoo is telling Verizon that a deal is a deal and that telecom giant has non legal recourse to change the terms. Yahoo's next board meeting is in two weeks but the two parties had been continuing discussions.
Armstrong's push for a $1 billion discount on the price is, one person told The Post, on top of a $1 billion reserve that Verizon may set aside to fund possible liabilities associated with the Yahoo email hack.
Verizon agreed to buy core internet properties in July.
"They (Verizon) are going to get the price discount", Robert Cattanach, a lawyer who specialize in cyber security and data breaches in Washington, D.C. firm Dorsey ad Whitney, told USA today at the time. "I would expect that there will be a fairly sophisticated effort to quantify the materiality of the impact of this breach and there would be some sort and price adjustment".
Verizon and Yahoo now still refuses to give comments regarding the matter.