Verizon's $4.8bn takeover of Yahoo delayed until Q2

By:
James Pearce
Published on:

SEC has also lauched an investigation into Yahoo after it disclosed details of two of the largest recorded data breaches of all time

Verizon has pushed back its acquisition of Yahoo until the second quarter of 2017 after a number of revelations about security breaches at the internet giant.

The US operator agreed to buy Yahoo’s core internet business for $4.8 billion in a deal struck in July, but revelations about two of the largest recorded data breaches cast doubt on the acquisition.

Yahoo disclosed that they had been hit with two breaches; a 2013 breach that may have impacted up to one billion user records, and a 2014 hack that is believed to have impacted around 500 million accounts.

The revelations about the two breaches reportedly led to Verizon asking for a discount on its agreed $4.8 billion fee, though this has not been confirmed by either company.

The deal was originally due to close in Q1, subject to all related approvals, but this has now been delayed until Q2, according to Yahoo.

"Yahoo has continued to work with Verizon on integration planning for the sale of its core business," the company said in a release. "In terms of timing, Yahoo had previously stated that it expected to close the transaction in Q1. 

“However, given work required to meet closing conditions, the transaction is now expected to close in Q2 of 2017. The company is working expeditiously to close the transaction as soon as practicable in Q2."

The delay comes as the Securities and Exchange Commission (SEC) launched an investigation into whether Yahoo should have announced the data breaches to investors at an earlier date.

The deal is for Yahoo’s core web portal business only, and excludes the firm’s shareholdings in Alibaba Group and Yahoo Japan. This will be span off into a separate company, to be named Altaba.