The deal, which is expected to close in the second quarter, will combine Yahoo's search, email and messenger assets as well as advertising technology tools with its AOL unit. Verizon will pay about $4.48 billion for Yahoo's operating business, and the two companies will share any potential legal and regulatory liabilities arising from two major data breaches announced in late 2016. “Although Verizon today is a $126 billion business (2016 revenues), it has only 114.2 million retail connections,” TechCrunch said, noting that it is picking up Yahoo’s more than 1 billion users, and digital content, for “a relatively small fee.”

What’s left of Yahoo after the deal — a holding company to be called Altaba — will be solely responsible for liabilities stemming from shareholder lawsuits and a Securities and Exchange Commission investigation of Yahoo, with liabilities from other litigation and government investigations to be split 50/50 with Verizon. The new terms "provide a fair and favorable outcome for shareholders," Marni Walden, Verizon's executive vice president and president of Product Innovation and New Businesses, said in a press release. “We look forward to moving ahead expeditiously so that we can quickly welcome Yahoo’s tremendous talent and assets into our expanding portfolio in the digital advertising space.”

Yahoo CEO Marissa Mayer called the move “an important step to unlock shareholder value for Yahoo” and said it would “accelerate Yahoo’s operating business especially on mobile.”

The security breaches, which took place in 2013 and 2014, raised concerns that Yahoo users might decrease their usage of the company’s email and other digital services that Verizon is buying. “The closing of the deal, which was first announced in July, had been delayed as the companies assessed the fallout from two data breaches that Yahoo disclosed last year,” Reuters reports. Verizon will combine Yahoo’s advertising technology tools as well as its search, email and messenger assets with its AOL unit, purchased for $4.4 billion in 2015.”

“The combined Yahoo and AOL businesses will help diversify Verizon away from its core wireless business, wrote Jennifer Fritzsche, an analyst at Wells Fargo, but ‘we would note its digital media and advertising business would still be a small percentage of revenues,'” Reuters reports. Yahoo is taking a $US350 million ($NZ488 million) hit on its previously announced $4.8 billion ($NZ6.7 billion) sale to Verizon in a concession for security lapses that exposed personal information stored in more than 1 billion Yahoo user accounts.
Verizon Communications agrees to buy the core business at Yahoo Inc. for $4.48 billion. Completion of this July 2016 deal had been delayed because of two data breaches Yahoo disclosed last year.