Verizon, in an arms race with rival AT&T, wants to buy Yahoo to give it a major presence in mobile media so it can target youngsters with ads. Bloomberg News and The Wall Street Journal first reported the discount agreement February 15.
In September 2016, Yahoo announced that at least 500 million users were affected by a late 2014 cyber-hacking incident led by a "state-sponsored" actor. The internet company disclosed that more than one billion user accounts had been hacked in August 2013.
Federal regulators are has Yahoo under their microscope due to the same data breaches. The company is very well aware that going to the Court will not be in its favor and that Verizon will have an upper hand before the judiciary. Both Yahoo and Verizon will have to go through a series of revisions before they reach a final decision. Importantly, the companies are discussing splitting any future liabilities resulting from the data breaches.
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Yahoo shares rose 1.7% to $45.78.
The embattled tech company has already been forced to deal with a number of hurdles surrounding its imminent sale to Verizon. Yahoo has lost its reliability and still struggles to garner new users for its email service and other features. Reports by the Wall Street Journal indicated this is an area of focus by the US Securities and Exchange Commission. Yahoo will likely be arm-twisted into this one, and will accept its fate for $4.6 Billion. She remarked that Yahoo Mail, Yahoo Sports, and Yahoo Finance still garnered significant traffic. Activist shareholders had the scent of blood for months before the Verizon deal was on the table and any shift away from closing the purchase would send them in for the kill. Since then, more serious security issues have been disclosed.
Yahoo has been struggling for more than a decade after Alphabet Inc (NASDAQ:GOOGL)'s Google has been crushing the former consistently taking away the share.