Ya­hoo’s inse­cure deal

Daily Freeman (Kingston, NY) - - BUSINESS -

Af­ter years of un­suc­cess­ful turn­around at­tempts, Ya­hoo may have now bun­gled its $4.8 bil­lion deal to sell its strug­gling online op­er­a­tions to Ver­i­zon Com­mu­ni­ca­tions.

An­a­lysts be­lieve Ver­i­zon is re­assess­ing the pur­chase price af­ter Ya­hoo dis­closed that com­puter hack­ers pulled off the in­ter­net’s big­gest heist of per­sonal in­for­ma­tion by break­ing into Ya­hoo’s data cen­ters two years ago. The stolen data in­cluded names, emails, pass­words, phone num­bers and birth­dates from at least 500 mil­lion of Ya­hoo’s user ac­counts.

Ver­i­zon so far has only said it in­tends to act in its best in­ter­est.

The deal seems un­likely to com­pletely un­ravel, even though news of the breach could drive away hordes of alien­ated Ya­hoo users. That’s be­cause Ver­i­zon also prizes Ya­hoo’s dig­i­tal ad tech­nol­ogy, and the value of those tools shouldn’t be af­fected.

At $4.8 bil­lion, the Ver­i­zon sale would yield about $5 per Ya­hoo share. Ya­hoo’s in­vest­ments in two Asian In­ter­net com­pa­nies, Alibaba Group and Ya­hoo Ja­pan, are worth far more. Those stakes, which aren’t part of the Ver­i­zon deal, cur­rently are worth a com­bined $30 bil­lion, or $31.50 per share, af­ter taxes.

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