Verizon signals Yahoo deal could be in trouble
Verizon’s attorney confirms that they consider the Yahoo hack a ‘material’ event, allowing the company to reconsider its acquisition, or the final terms of the transaction
It was a deal that many already had concerns about, but when Yahoo revealed the extent of the customer hack it has suffered, there were immediately concerns that their acquisition by Verizon could be in trouble. Now, Verizon has confirmed it.
Verizon’s top attorney has confirmed that it considers the hack a “material” event, meaning on that could affect its acquisition of the legacy Internet brand.
“I think we have a reasonable basis to believe right now that impact is material,” Verizon General Counsel Craig Silliman said at a roundtable, according to The Washington Post. “And we’re looking to Yahoo to demonstrate to us the full impact if they believe it’s not. They’ll need to show us that, but the process is in the works.”
The pronouncement could mean the the $4.83 billion deal may be dead, or it might mean that Verizon wants to renegotiate the final price – something many observers have anticipated since the hack became known.
Verizon CEO Lowell McAdam said on Monday that the company was still looking in what effect the news might have on the deal. “But in fairness,” McAdam said, “we’re still understanding what was going on, to define whether it’s a material impact to the business or not. But the industrial logic of doing this merger still makes a lot of sense.”
None of this has helped Yahoo stock, which has slid since Tuesday, and is down more 1.5 percent today.
Yahoo is not the only Internet brand struggling to close a deal. Twitter’s sale remains pretty remote right now, with only Salesforce still publicly expressing interest – though that company’s CEO is facing opposition from investors who are asking “huh?”