When a company sees its value decrease by hundreds of millions of dollars, that’s usually considered to be a very bad thing. But not for Yahoo (NASDAQ:YHOO).
The company is still in buyout talks with Verizon. But after a series of recent data breaches, Verizon wants to cut the purchase price by about $250 million.
This is far from an ideal situation for Yahoo. Of course, the company would still like to be valued at the previous price tag of $4.8 billion. Or even better, it would like to travel back in time by about a decade. But those aren’t realistic options for the company at this point in time.
So considering the data breaches and other public missteps by the company, this price cut really isn’t all bad. And it’s likely the best offer that the struggling tech company is going to get.
Yahoo’s story serves as a cautionary tale for other businesses on multiple levels. First, it demonstrates just how big of an impact cybersecurity issues can have on the value of a business.
Sometime You Just Have to Choose the Lesser Evil
But second, it also shows how sometimes businesses have to make decisions even when none of the options look especially appealing. Sure, Yahoo would probably like to rethink some of its earlier decisions. But given where the company is now and the dwindling options it has moving forward, the sale to Verizon could simply represent the best in a list of options that are far from ideal.
Yahoo Photo via Shutterstock
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