Verizon wanted $1.2bn discount for Yahoo merger, got $462m

Verizon sought almost triple the price reduction it ultimately obtained for Yahoo's core assets following two massive cyber attacks at the internet company, according to a Yahoo filing.

The closing of the deal, which Verizon first announced in July for a purchase price of US$4.83 billion, had been delayed as the companies assessed the fallout from two data breaches that Yahoo disclosed last year.

The top US wireless carrier had been trying to persuade Yahoo to amend the terms of the agreement following the attacks.

In early February, Verizon CEO Lowell McAdam told Yahoo director Tom McInerney a price reduction as high as US$925 million (A$1.2 billion) could be appropriate, according to the filing.

McInerney later told McAdam at a meeting in Verizon's New York offices that Yahoo's board was unwilling to agree to such a big discount.

Verizon said in late February it had agreed to a purchase price of US$4.48 billion, lowering its original offer by US$350 million (A$462 million).

A Verizon spokesman declined to comment on why it agreed to a lower discount that it had sought.

The filing also revealed Yahoo CEO Marissa Mayer would leave Yahoo once it is sold and receive a severance package of US$23 million. The package consists of US$3 million in cash and US$20 million in stock.

Mayer will be replaced by Yahoo board member Thomas McInerney, who will become the head of the company that is left over after the deal - a holding company for a stake in Chinese e-commerce giant Alibaba that will be renamed Altaba.