As cyber breaches become more impactful and frequent, decision-makers must incorporate a cyber review into their M&A plan. (Credit: designer491/Shutterstock)
June marked the anniversary of the Verizon and Yahoo! deal — not that there was anything to celebrate. No company wants an acquisition to end up the way Yahoo! did for Verizon. The massive breach of every single Yahoo! account — over 3 billion in all — contributed to the significant devaluation of Yahoo! for Oath, the subsidiary of Verizon that made the purchase. This devaluation amounted to a writedown of almost $5 billion after the original acquisition price of under $4.5 billion. Talk about adding insult to injury.
While perhaps it’s not always the first thing business leaders think about when discussing a deal, cybersecurity audits are a vital aspect of mergers and acquisitions (M&A). Businesses need to vet companies that they would like to acquire in order to determine their cyber vulnerability, because the buyer ultimately inherits all of the target’s exposures and liability.
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