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Verizon/Yahoo saga looks like it might be just about finished… maybe

Yahoo HQ

The longest running will-they-won’t-they saga since the high-voltage Fred-Daphne cliff-hanger in Scooby-Doo is almost at a conclusion, with Verizon likely securing a discount on its Yahoo acquisition.

According to Bloomberg’s sources, Verizon is on the verge of securing a $250 million discount on its $4.8 billion Yahoo purchase following a number of embarrassing security breaches, which called in the question whether the deal would actually go ahead. People close to the situation believe an announcement could be made in a matter of days or weeks, which would bring the matter to a close.

Since the breaches were made public last year, the threat of Verizon walking away from the deal has always loomed in the background. In October, Tim Armstrong, who runs the Verizon content business, hinted it would be after a discount, just before Verizon’s top lawyer Craig Silliman said the team might trigger a clause which meant it could back out of the deal. And that was all before a SEC investigation in January to decide whether the team was quick enough in disclosing the hacking scandal to investors.

You can’t say Verizon didn’t have enough ammunition.

Alongside the discount, Verizon and Altaba, the remaining Yahoo business units which Verizon will not buy, will split the on-going legal costs of dealing with the breaches. While the discount is not earth-moving, considering the size of the acquisition, the splitting of legal costs could be a more significant win; who knows how much that is actually going to cost.

There will probably be a number of people in the industry who will be glad to see the back of this acquisition, as well as a few others who will ask whether buying such a dated, porous and headache inducing asset was really worth the bother for the Verizon team. Furthermore, given the extent of Yahoo’s admissions since the acquisition was first announced, it’s surprising Verizon hasn’t been able to secure a much larger discount.


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