February 21, 2017•Update: February 21, 2017
By Ovunc Kutlu
NEW YORK
Communications giant Verizon and internet firm Yahoo agreed to cut $350 million from the price for the firm they agreed to last year, the companies announced Tuesday in a joint statement.
The two firms agreed last July that Verizon would buy Yahoo for $4.83 billion. The deal, however, could have fallen apart after 1 billion Yahoo users were believed to be hacked in 2013, and another 500 million in 2014.
"Verizon and Yahoo will share certain legal and regulatory liabilities arising from certain data breaches incurred by Yahoo," the statement read, but gave no details on reasons for the price cut.
The new deal is now worth $4.48 billion in cash, and is expected to be concluded in the second quarter of this year.
"As part of the agreement, Verizon would acquire Yahoo’s operating business and global audience of more than 1 billion users, including more than 600 million mobile users," the statement said.
More than 1 billion users are expected to give a major competitive advantage to Verizon in the communications and Internet services markets, especially after the firm bought another internet giant, AOL, for $4.4 billion in 2015.
With the deal, Verizon is also expected to generate more revenue through mobile video services and online advertising. The company's revenue fell to $32.34 billion, or 5.6 percent, in the fourth quarter of 2016 year-on-year.
After Tuesday's announcement, shares of both companies rose by 0.5 percent on Wall Street.
