Yahoo and Verizon are close to finalizing the terms of a renegotiated acquisition deal that would cut the internet company’s $4.8 billion price tag by around $250 million, Bloomberg reports. Verizon pushed for the price cut in the wake of last year’s revelations that Yahoo had been the victim of two massive security breaches that affected hundreds of millions of accounts.
In September, Yahoo disclosed that a 2014 hacking incident, believed to have been perpetrated by a foreign government, had affected 500 million users. In December, it revealed that an even larger cyberattack in 2013 had compromised email accounts and affected as many as 1 billion users.
News of the attacks– some of the largest security breaches in recent memory– delayed the sale, which had originally been scheduled to close in the first quarter of 2017, as Yahoo conducted internal investigations.
Now, Verizon and Yahoo are close to agreeing on a revised deal, the terms of which dictate that the two companies both bear the legal responsibility and costs of the data leaks. While the deal is still subject to revision, if approved, it would transfer core Yahoo assets– including its email service, Yahoo Finance, Fantasy Sports, search, and messenger– to Verizon, which seeks to branch out into mobile video and advertising for new revenue streams.
Combined with AOL, which Verizon acquired for $4.4 billion in 2015, the Yahoo purchase would help the telecom giant compete against major advertisers like Google and Facebook. Yahoo would retain its most valuable assets — its 15% stake in Alibaba and 36% stake in Yahoo Japan worth around $48 billion combined— under a separate corporate entity named Altaba Inc.
Shares of Yahoo surged after the Bloomberg report was released, and closed up 1.4 percent, while Verizon shares fell 0.7 percent.