On Thursday, Yahoo Inc. disclosed a security breach that occurred in late 2014, affecting at least 500 million of its one billion users. It is postulated that the cybercrime was carried out by a “state-sponsored actor.” Stolen account information includes names, dates of birth, email addresses, telephone numbers and encrypted and unencrypted security questions and answers. While further investigation by the law enforcement is still being carried out, Yahoo states that current prognosis does not indicate that there has been theft of payment data, bank account information or unprotected passwords.
This news occurs at an exceptionally sensitive time for Yahoo as the $4.8 billion acquisition by Verizon Communications Inc. is projected to close by early 2017. Verizon provided a statement claiming that they were notified of the security breach within the last two days but still have “limited information and understanding of the impact.” As of now, Verizon “will evaluate as the investigation continues through the lens of overall Verizon interests, including consumers, customers, shareholders and related communities.
Riley & Co. analyst Sameet Sinha believes that the incident is unlikely to affect the Yahoo-Verizon deal since “data breaches have become part of doing business” nowadays. He goes on to use Microsoft Corp’s $26.2 billion buyout of LinkedIn, in June following their May disclosure, as an example. In terms of the stock market, Yahoo shares rose by 0.8 percent to $44.49 in afternoon trading, while shares of Verizon increased 0.9 percent to $52.35.