Microsoft Eyes Yahoo! in Proposed Takeover

By Michael Santo
Executive Editor, RealTechNews

In a move likely spurred on by losing out to Google in the DoubleClick acquisition last month, Microsoft has apparently re-entered talks with Yahoo! over a possible takeover. Talks have been off and on for some time, and rumors of the bid caused Yahoo! stock to surge 18% in early trading.

While Microsoft and Yahoo! have held informal deal talks over the years, sources say the latest approach signals an urgency on Microsoft’s part that has up until now been lacking.

The new approach follows an offer Microsoft made to acquire Yahoo! a few months ago, sources said. But Yahoo! spurned the advances of the Redmond, Wash.-based software giant. Wall Street sources put a roughly $50 billion price tag on Yahoo!. Source: NY Post

We Say: According to the Financial Times, this would triple Microsoft’s search share (combining their own with Yahoo!’s), though they would still trail Google badly. More importantly, perhaps, would be Yahoo!’s advertising acumen … and Microsoft would also be out of the “bridesmaid” category that it’s been relegated to in recent deals.