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If you deal with Yahoo in any way, shape, or form you heard the news on Wednesday of 1 Billion Yahoo accounts being hacked. That is terrible news all across the board if you are some form of stake or shareholder of Yahoo. This is already in addition to the 500 million accounts hacked back in September. According to The New York Times, this hack is different than 2014 hack that compromised 500 million accounts, as this one occured in 2013. Okay, if you have anything to do with Yahoo you should be two things, worried and disappointed. Unless you go directly to Yahoo and hound them, you're unlikely to know if you're account has been one of the 1.5 billion that were hacked. There are about 1 billion active monthly users on Yahoo as it is, according to DMR, so you shouldn't think for a second your account wasn't one of the ones hacked. How can a company as big as Yahoo get hacked on such a large scale? Better yet, why didn't Yahoo disclose this earlier to stake and shareholders, as well as the FBI? Speaking of the FBI, the FBI is investigating the 2013 hack and just as why Yahoo didn't disclose to users. Check out this video from Cavuto Coast to Coast on FBN:
It's inexcusable as top international company to one, get 1.5 billion user accounts hacked, but two not to disclose it once you find out about it. There will be a lot more to come out this, that's for sure.
Bad news for consumers, bad news for investors, and terrible news for Yahoo's board of directors. Although this a somewhat good news for Verizon. Back in July of 2016, Verizon announced their $4.83B deal to acquire Yahoo. This gives Verizon significant leverage into lowering the price of this deal. Verizon isn't going to walk away from the table, Yahoo still has what Verizon wants, and Verizon will likely take over the cyber security, as they should. The price could maybe get lowered as much as $1 billion, and due to the scrutiny and troubles Yahoo is facing, it'll be hard for Yahoo to say no to that. It'll honestly be the best thing for Yahoo is to get acquired by Verizon to help extinguish the fire these hackings have started. Yahoo really has no say anymore in this deal, Verizon has all the right to get up and walk away, but they're likely going to demand a lower deal and Yahoo will probably still accept. Yesterday, AOL's Co-Founder Steve Case made just that argument. Verizon bought AOL for $4.4B for AOLs ad and content business. Verizon is doing the same here with Yahoo and Verizon is really focusing on becoming what AT&T already is, and bringing more content and ad space to mobile devices. Verizon has the infrastructure while AOL and Yahoo have the content. Here's a video of Steve Case on Fox Business yesterday making his case:
Verizon has to be a bit worried themselves acquiring Yahoo now, because what if the hacks extend beyond just user information? Who's to say the hackers didn't steal Verizon/Yahoo deal information? Then what happens, lawsuit? These hacks are a very big deal, and every single company on the planet should be taking notice, and do what they can to prevent this from happening to them.
Verizon could walk away, but it seems that AOL wasn't enough for them, and that Verizon needed Yahoo or another company similar to AOL. There are slim pickings out in the industry now to really satisfy what Verizon is shooting for, so with that being said, Verizon will demand a discount and Yahoo more than likely will accept. Yahoo use to be the biggest search engine, and dot-com company in the world back in the late 90s early 00s before Google took the spotlight. Since Google over taking Yahoo in search, Yahoo did well on getting passed search and focused on web content, but that has since declined. With all that being said, you can see why Yahoo was ready to sell itself. It's sad to see a once thriving dominate company like Yahoo decline like they have, and also have 1.5 billion accounts hacked. Yahoo went from riches to rags in almost two decades. Yahoo better hope Verizon salvages whatever legacy Yahoo has left. Here are the 5 day Yahoo and Verizon stocks, per Google:
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