Verizon tried to acquire Yahoo’s online services for nearly $1 billion less than initially offered after the internet company acknowledged being the victim of two major data breaches, according to a regulatory filing Monday.
Both companies agreed in July that Verizon would purchase Yahoo’s email and other digital services for $4.83 billion. After reports emerged afterwards concerning a pair of data breaches, however, Verizon went back to the drawing board and demanded a $925 million discount, the filing revealed.
Yahoo balked at the request and eventually agreed to slash $350 million off the original price — nearly there times the discount Verizon had requested, according to the filing.
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The regulatory paperwork doesn’t state explicitly why Verizon reneged on its original offer, and a spokesperson for the telecom declined to comment, Reuters reported.
Verizon’s demand for nearly a $1 billion discount occurred shortly after Yahoo acknowledged a major data breach in September and another three months later, however — the likes of which the company attributed with compromising more than a billion user of its hallmark email service.
Lowell McAdam, Verizon’s CEO, asked for the $925 million discount during an early February meeting with Tom McInerney, a Yahoo board member, according to the filing. Both sides went back and forth before agreeing to slash roughly one-third that amount from Verizon’s initial offer.
“After further discussion, Mr. McAdam and Mr. McInerney each agreed to review with their respective boards of directors a proposal that included a purchase price reduction in the amount of $350 million,” the filing said.
Verizon is currently slated to compete the $4.48 billion acquisition by the end of June. If and when the deal succeeds, the telecom will assume ownership of various Yahoo services and its billion-plus monthly users.
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