Closing Of Verizon-Yahoo Merger Transaction Pushed To Second Quarter Of This Year
Yahoo has just published its quarterly earnings report for the final quarter of 2016, but many would agree that its financials do not matter much for now considering the once dominant Internet company is currently in the process of being acquired by Verizon Wireless. Still, a footnote in Yahoo’s quarterly report should be intriguing to most, due to the fact that it announces quite straightforwardly that the closing of the merger transaction will be pushed to the second quarter of this year. Verizon’s acquisition of Yahoo was supposed to close during the first quarter of 2017, but obviously, that is not happening. Strangely, Yahoo has offered no adequate explanation for the delay, other than saying that it is as committed as ever in working with the Big Red in finalizing the deal.
It is easy to expect the worst of this deal, especially with what Yahoo has been through in the last few months. While it is true that the company never wished to be hacked (and twice at that), but many would agree that it could have done a better job at handling the mess, especially after it was revealed that it did not bother to disclose the hacking incidents to all concerned parties sooner. Last month, Yahoo had stated that over a billion user accounts were compromised back in August of 2013. It should be noted that this is a separate incident from that other big hack that breached over 500 million user accounts. Suffice it to say that all that bad publicity is not doing anyone any good, especially Verizon Wireless who was looking to purchase Yahoo for a sum of $4.8 billion.
To make matters worse, the Securities and Exchange Commission (SEC) is now investigating Yahoo for failing to disclose the two hacking breaches sooner. Oh, and there are also rumors flying around that Verizon Wireless is now requesting for a discount on the acquisition deal (buyer’s remorse, anyone?).
Still, it is worth remembering that merger transactions are often easier said than done. In Yahoo’s case, we are talking about a company that has a complicated structure, and figuring out the terms of the deal down to every detail can be time consuming. If Yahoo and Verizon Wireless are indeed taking their time in order to make sure the deal is made right, then the extension of the closing schedule should not pose any concern for both parties.