MS News Corp vs Yahoo Leak

MySpace parent company News Corp. is looking to join Microsoft as a partner in the latter's attempt to take over Yahoo, say apparent sources in touch with the Wall Street Journal. Without going into details, the paper suggests that News Corp. is in "serious" discussion to contribute to the deal. The combination would potentially help overcome Yahoo's frequent rejections of Microsoft's overtures, which argue that the original $31 per share bid for Yahoo undervalues the search firm.

Simultaneously, the Journal also claims that Yahoo's discussions with AOL have also grown equally serious and are close to their final stages. In the discussed plan, AOL would split off from Time Warner and subsumed into Yahoo along with a financial investment. The funding would let Yahoo buy back up to "billions" of its own shares at greater than normal values of between $30 and $40 per share, complicating any attempt by Microsoft to purchase Yahoo on the originally submitted terms.

The reported move, if true, comes just as Yahoo has begun testing Google AdSense on its search results in a gesture already seen as an attempt to dissuade Microsoft from its hostile bid. Sources at the newspaper allegedly have confirmed the at least temporary alliance as a show of worth that will at least pressure Microsoft into raising its bidding price, which it has refused to do since the offer was first made public.

While not revealing whether it's aware of any Yahoo deals with companies besides Google, Microsoft has maintained that its control of Yahoo would better benefit both the company and the Internet as a whole by creating a viable competitor to Google, and labels a tentative Yahoo deal with Google as a monopoly.

By Electronista Staff