Yahoo may be takeover target for 2nd time
By Michael Liedtke |
October 15, 2010, Friday
|
Print Edition
Print Edition
YAHOO Inc's inability to snap out of a financial funk may be about to turn the embattled Internet company into a takeover target for the second time in less than three years.
That possibility, floated in a story posted online late Wednesday by The Wall Street Journal, lifted Yahoo's shares by nearly 13 percent in Wednesday's after-hours trading.
After snubbing a US$47.5 billion buyout offer from the much larger Microsoft Corp in 2008, Yahoo this time may find itself being courted by a smaller rival with its own problems, AOL Inc.
If Yahoo gets another offer, it will likely be for considerably less than what the company could have gotten had it embraced Microsoft. Yahoo's market value now is less than US$25 billion, even after factoring in the runup from the takeover speculation.
Still, it appears AOL realizes it would need to bring in more financial muscle to get a deal done. The company, based in New York, is discussing the possible Yahoo offer with several firms that specialize in buying companies whose stocks have fallen out of favor, according to the Journal.
The story identified Silver Lake Partners and Blackstone Group LP as two of the firms huddling with AOL. The Journal cited unnamed people familiar with the talks, which were described as preliminary.
Yahoo hadn't been contacted by AOL or any of the other potential suitors, the Journal said.
Yahoo has been testing the patience of its shareholders for the past four years, as its financial performance flagged while the once-smaller Google Inc blossomed.
That possibility, floated in a story posted online late Wednesday by The Wall Street Journal, lifted Yahoo's shares by nearly 13 percent in Wednesday's after-hours trading.
After snubbing a US$47.5 billion buyout offer from the much larger Microsoft Corp in 2008, Yahoo this time may find itself being courted by a smaller rival with its own problems, AOL Inc.
If Yahoo gets another offer, it will likely be for considerably less than what the company could have gotten had it embraced Microsoft. Yahoo's market value now is less than US$25 billion, even after factoring in the runup from the takeover speculation.
Still, it appears AOL realizes it would need to bring in more financial muscle to get a deal done. The company, based in New York, is discussing the possible Yahoo offer with several firms that specialize in buying companies whose stocks have fallen out of favor, according to the Journal.
The story identified Silver Lake Partners and Blackstone Group LP as two of the firms huddling with AOL. The Journal cited unnamed people familiar with the talks, which were described as preliminary.
Yahoo hadn't been contacted by AOL or any of the other potential suitors, the Journal said.
Yahoo has been testing the patience of its shareholders for the past four years, as its financial performance flagged while the once-smaller Google Inc blossomed.
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