Verizon placed a $4.83 billion bid to purchase Yahoo earlier this year. The company said on Thursday that it is looking into whether it should renegotiate its offer in light of Yahoo’s massive data breach.
In June, Verizon purchased Yahoo’s core business—advertising, content, search and mobile activities—for $4.83 billion in cash. At the time, Verizon Chairman and CEO Lowell McAdam said: “The acquisition of Yahoo will put Verizon in a highly competitive position as a top global mobile media company, and help accelerate our revenue stream in digital advertising.”
In September, Yahoo made a major announcement: the company confirmed a data breach that compromised more than 500 million user accounts. The internet company said a wide array of user information was taken from its network in 2014 by a "state-sponsored actor," but it did not include unprotected passwords, payment card data or bank account information.
News of the data breach first made headlines in August after a notorious cybercriminal, known as “Peace,” alleged he had 200 million credentials of Yahoo users from 2012. The asking rate for the data — according to Yahoo, it includes names, email addresses, telephone numbers, dates of birth, hashed passwords and more — on the dark web was roughly $1,860. In the past, Peace has sold hacked data from Myspace and LinkedIn.
"Yahoo is notifying potentially affected users and has taken steps to secure their accounts," the company said on its investor relations page. "These steps include invalidating unencrypted security questions and answers so that they cannot be used to access an account and asking potentially affected users to change their passwords. Yahoo is also recommending that users who haven't changed their passwords since 2014 do so."
Earlier this month, the New York Post reported that Verizon is seeking a $1 billion discount on the deal. Citing anonymous sources, the Post says Verizon is looking to renegotiate over Yahoo’s “diminished” value.
But TechCrunch, which is owned by Verizon, reports that when Verizon Chief Financial Officer Fran Shammo was asked about the Yahoo breach in an analyst call, he said the lawyers for the two companies had their first call about the “extremely large breach.” Shammo said he believes the breach will have a “material impact” on Yahoo and that the trajectory of seeing the full impact is “going to be a long process.”
“Let me just reiterate what they have said — we are still evaluating what it means for the transaction," said Shammo.