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Microsoft to make joint bid for Yahoo?

updated 08:45 am EDT, Wed July 2, 2008

MS Joint Yahoo Bid Rumor

Microsoft is actively exploring bringing other companies into a deal that would dismantle Yahoo as it's known today, says the Wall Street Journal. The newspaper cites anonymous sources aware of discussions who say Microsoft is still interested in buying just Yahoo's search business but has asked both News Corp. and Time Warner about merging what would be left of Yahoo into one of their respective properties, such as MySpace or AOL. A meeting between Microsoft and Yahoo was scheduled for Monday but canceled because Microsoft has so far been unsuccessful in lining up a partner, according to the report.

Both News Corp. and Time Warner have previously been identified as potential partners for Yahoo, the latter having sought out deals the two companies as attempts to sour any efforts by Microsoft to bid at its original price.

The news also brings word that neither Microsoft nor Yahoo has revealed full details of the failed bid for all of Yahoo. While Yahoo has publicly said that Microsoft would not back away from its $31 per share bid and at most put out an unofficial bid of $33 per share before promptly walking away from talks in May, the Journal now says that Yahoo had volunteered two weeks to be taken over at a cost between $33 and $34 per share but that Microsoft chief Steve Ballmer at this point refused, instead making the company's still standing offer of buying just Yahoo's search business.

Yahoo refused under its well-known stance that such a deal would gut its core business and privately saw Microsoft's determination to buy some or all of Yahoo as a reflection of Ballmer's personal obsession with thwarting Google at all costs, calling his offers a cure for "filling his Internet hole."

Microsoft and Ballmer specifically have argued since the initial late January bid for all of Yahoo that it was necessary to create a second major search outlet large enough to challenge Google's ad and search business, although critics have also charged that Microsoft is concerned about the potential success of Google's web apps at undermining Office.

By Electronista Staff


  1. gambit-7

    Fresh-Faced Recruit

    Joined: Feb 2001



    Let it die, for the love of God.

  1. neondiet

    Fresh-Faced Recruit

    Joined: Nov 2007


    Microsoft shenanigans

    It's pretty obvious from the document Yahoo! filed with the SEC yesterday, targeting its shareholders, that Microsoft's bid for the purchase of Yahoo!'s search business was not anywhere as lucrative as it first appeared. Their loss of control over that revenue stream would have seriously damaged Yahoo!'s ability to grow its business. Given that Icahn is already a shareholder in Time Warner (and previously tried to split it up into 4 smaller companies) you can bet he will try and play this to his advantage. This can't be a co-incidence on Microsoft's behalf and stinks of dirty tactics.

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