This cyber breach could have been avoided with an access management patch costing $180,000.00 but management deferred this patching to the following fiscal year! The Yahoo 2016 sale included all real estate and investment assets including:

• 383.5 million shares of Alibaba at $190.52 = $73.06 billion

• Yahoo Japan 1.9545 shares YAHOO at $4.53= $8.89 billon

In 2016, Verizon bankers assigned an after tax discounted value of these investments at $32.64 billion. This discount was attributed to the unknown cyber liability based on poor cyber security. As a result of the discounted value of $32.64 billion, the Yahoo sale price was $27.00 billion. This left Yahoo with a negative $5.24 operational value. Once the Yahoo sale was finalized, the Verizon balance sheet assured coverage of potential cyber liabilities.

Since 2016, Yahoo assets increased by 144% creating a market cap of 66.87 billion or after-tax value $65.56 billion. Unlocking the value of these assets created a $55.56 billion windfall for Verizon and $55.56 billion loss to Yahoo shareholders! The markets are Darwinian in nature and operate based on survival of the fittest.

As an important lesson learned, management must understand cyber risk and establish a proactive defense using managed security services!