United State’s largest wireless communication service provider Verizon Communications Inc. could put forward a revised deal for buying erstwhile Internet giant Yahoo Inc.’s root businesses. Sources have reported that the Verizon could restructure the deal so that it would have to shell out around $250 million to $350 million less than the initially agreed price of $4.83 billion.
Well, judging by these reports, it would appear that Yahoo’s major data breaches from the second half of 2016 are still showing their aftermath. It has previously suffered an inquiry under federal investigators and lawmakers after surfacing what turned out to be one of the biggest data breach in the history.
Also, since the incident, there has been constant talk of Verizon eventually forcing Yahoo to amend the clauses of acquisition agreement t drop the price even further. To be fair, Yahoo stock did take a hit following the news of the leak. An insider with good knowledge of the scenario predicted the price cut will possibly be close to $250 million — a figure also predicted by Bloomberg this Wednesday.
Verizon is most likely to amalgamate its AOL unit — bought in 2015 for $4.4 billion — with Yahoo’s search features, mail and messenger services and advertising assets. Verizon is said to have realized that the wireless communication market is moving towards saturation and is thus looking forward to new sources of revenue, like mobile videos and advertising.
Meanwhile, in the morning trading, Yahoo shares rose 1.6 percent to $45.76 whereas Verizon shares fell 0.7 percent to $47.96. In case you are wondering, the jump in Yahoo shares is likely to be caused due to relief that contrary to rumors, Verizon isn’t pulling gout of the deal altogether, which would have been pretty bad. Compared to that situation, a $250 million discount is likely to be something Yahoo will easily agree to — specially since the major data breach, that has left it without any bargaining chip in its power.
