Mon, Oct 24, 2011 - Page 10 News List

Google mulling Yahoo bid role: report

LOSING THE PLOT:Yahoo is under pressure because its revenue has been falling as Internet advertising has grown and Google and Facebook have gained market share

AP, NEW YORK

Alibaba Group chairman Jack Ma speaks on the second day of the Wall Street Journal’s three-day ‘All Things Digital’ conference in Hong Kong.

Photo: AFP / ASA MATHAT / ALL THINGS DIGITAL

Google is exploring the possibility of helping to finance a possible deal by others to acquire Internet search company Yahoo, according to a report published by the Wall Street Journal on Saturday.

Google Inc has talked to at least two-private equity firms about potentially assisting them to finance a deal to buy Yahoo Inc’s core business, according to the story, which cited a person familiar with the matter, but did not identify the source.

The Journal said Google and its prospective partners had held early-stage discussions, but had not yet assembled a formal proposal. The source said Google could still decline to pursue a bid.

A spokeswoman for Google declined to comment. A spokeswoman for Yahoo said the -company does not comment “on rumor or speculation.”

Any involvement by Google in a Yahoo acquisition would likely draw antitrust scrutiny from regulators, because of both companies’ shares in the Internet search business.

The report came as investors have recently driven up Yahoo’s stock price, betting that the company would sell itself, either in whole or in part.

At close of trading on Friday shares in Yahoo were US$16.12, a gain of nearly 25 percent since Sept. 6, when Yahoo chief executive Carol Bartz was fired. The price is now 45 percent higher from the stock’s 52-week low in early August.

There has been repeated speculation that the company could be sold to an assortment of buyout firms that prey upon troubled companies. Alibaba Group (阿里巴巴集團), a Chinese Internet company in which Yahoo owns a 43 percent stake, has expressed interest if it can line up the financing for a deal that would likely require a bid of more than US$20 billion, the current market value of Yahoo’s shares.

Microsoft Corp, which offered to buy Yahoo for US$47.5 billion in 2008 before withdrawing the bid, has also been mentioned as a possible suitor.

Since Bartz was fired, her replacement Time Morse has served as Yahoo interim chief executive and chief financial officer. After the company’s third-quarter earnings announcement on Tuesday, Morse told analysts that he could not discuss what the company’s next step might be or when it might take it.

Yahoo is under pressure because its revenue has been falling at a time when the Internet advertising market has been growing as rivals such as Google and Facebook gain market share.

Although it is still recognized around the world, Yahoo’s brand has lost much of its luster as people have increasingly turned to social networks such as Facebook and short-messaging service Twitter to keep track of what’s going on instead of relying on a media hub like Yahoo’s Web site.

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