Yahoo's Data Hack Is Hanging Over the Verizon Deal
This isn't good.
Poor Yahoo. It seems the data breach revealed in September has had a big impact on the Verizon deal. A new report with the Securities and Exchange Commission (SEC) filed Monday reveals the $4.8 billion deal for Verizon to buy Yahoo has been pushed back.
When the deal was announced in July 2016, it was expected to close by the end of March this year. In Yahoo’s latest quarterly financial report, though, the company revealed it now expects the deal to close in the second quarter of 2016, which starts in April.
Verizon, which released its latest financial report on Tuesday, is staying cautious. “Regarding the Yahoo acquisition, Verizon continues to work with Yahoo to assess the impact of data breaches,” the company said in a statement posted on its website.
On Monday, the Wall Street Journal revealed that Yahoo is under SEC investigation. Authorities are concerned that Yahoo should have disclosed the breach sooner than it did: the company has not explained why it disclosed the hack two years after it took place.
The report claims that Yahoo did not say anything before because it believed the hack affected far fewer people than it did. In the end, 500 million users were found to have had their information leaked.
As the case trundles on, it remains unclear what this means for Verizon’s buyout of the internet giant. Yahoo is not in the best of shape, its declining popularity leaving it in the shadow of its glory days. But Verizon’s deal could bring new-found relevance to the company as the cellphone carrier looks to provide content to its subscribers. Nonetheless, a hack of this magnitude is severe, and it seems Verizon is still considering its widespread impact.
