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Yahoo agreed to take a $350m cut on the original $4.8bn sale of its core-business to Verizon, becoming one of the first major US companies to revise deal terms due to a cyber attack.
Verizon, the US telecom giant, will now pay the California-based internet company $4.5bn, Yahoo said in a statement on Tuesday.
Marni Walden, Verizon’s executive vice president, said that the new “terms of the agreement provide a fair and favorable outcome for shareholders. It provides protections for both sides and delivers a clear path to close the transaction in the second quarter.”
After the Verizon deal was announced last year Yahoo disclosed that it had suffered two mega cyber attacks that pre-dated its sale agreement. Under the amended terms of the deal, the companies agreed that the data breach – which affected around 1bn Yahoo users – and any related losses would not be taken into account when determining if a “business material adverse effect” had occurred.
Yahoo is also facing a Securities and Exchanges Commission probe into whether it appropriately disclosed information about the data breach.
As part of the agreement Yahoo and Verizon will equally share responsibility for an cash liabilities linked to data breaches.
Meanwhile, Yahoo will be wholly responsible for liabilities arising from shareholder lawsuits and SEC investigations.
The deal is now expected to close in second-quarter 2017.
*This post has been updated to reflect that the companies have agreed to amended terms stating that the data breach would not be considered in determining whether a “business material adverse change” had occurred or if certain closing conditions were met.