Internet pioneer Yahoo Inc. has agreed to sell its core business to Verizon for $350 millions less than the originally negotiated price tag of $4.83 billion, the struggling web company confirmed on Tuesday.
Reports about a potential price cut had been swirling around the web for the past many weeks as Yahoo’s reputation suffered a major setback due to hacking scandals.
In September last year, Yahoo admitted that it suffered tow data breaches in 2013 and 2014 that jeopardized the privacy of more than a billion users. Telecommunications giant Verizon announced a deal to buy Yahoo’s operating business around seven months ago.
The acquisition deal had been on shaky legs since Yahoo revealed the massive data breaches, but the telecommunications giant didn’t lose faith in Yahoo’s business.
Verizon’s Executive VP Marni Walden said, “We have always believed this acquisition makes strategic sense. We look forward to moving ahead expeditiously so that we can quickly welcome Yahoo's tremendous talent and assets into our expanding portfolio in the digital advertising space.”
Under the terms of the renegotiated deal, the two companies have agreed to share the potential legal and regulatory burdens that are expected to come from the two data breaches.
Yahoo Inc., which has more than one billion monthly active users, is already under investigation by the U.S. Securities & Exchange Commission (SEC) for taking too long to inform investors and users about the data breaches.