Big players circle Yahoo
EmptyTime Warner Inc.'s AOL unit is inching closer to a merger deal with Yahoo, while Microsoft Corp. has approached News Corp. about a potential joint takeover bid of Yahoo, the Wall Street Journal reported late Wednesday night, citing people familiar with the matter.
The Journal is now part of Rupert Murdoch's News Corp. Shortly before midnight ET, the paper reported on its Web site that Microsoft is recrafting its Yahoo strategy. Microsoft and News Corp. have yet to agree on possibly bidding together. A combination would bring together the entertainment conglomerate's online social networking powerhouse MySpace, Microsoft's MSN and Yahoo. However, a three-way link-up could also prove difficult to manage. A News Corp. spokeswoman would only say: "We don't comment on speculation."
Meanwhile, Yahoo and TW are discussing combing AOL with Yahoo and having TW make a cash investment in return for about 20% of the combined entity, according to the Journal. Yahoo would use the TW cash and additional funds to buy back several billion dollars worth of its own stock, it added.
Spokespeople for TW weren't immediately available for comment.
Earlier in the day Wednesday, Yahoo also made good on its promise to explore various "strategic alternatives" by unveiling a test partnership with Google that will display search results with Google ads next to them.
Over the weekend, Microsoft had given Yahoo's board a three-week ultimatum to sell to the software giant or face a proxy battle and maybe even a lower bid.