News
Yahoo Seeking Deal with News Corp.
- By Becky Nagel
- February 13, 2008
The
Wall Street Journal reported
Wednesday that Microsoft is facing another suitor for Yahoo: Rupert
Murdoch's News Corp.
According to the article, Yahoo may be looking to form a partnership with News
Corp.'s Web properties, including MySpace, as a way to stave off Microsoft's
bid for the company. If the deal goes through, Yahoo would remain independent,
with News Corp. gaining a percentage of Yahoo that "could be more than
20 percent."
The WSJ's Jessica E. Vascellaro reported that since the day after Microsoft
proposed acquiring Yahoo, the Sunnyvale, Calif.-based company has "aggressively"
sought out other solutions.
Speculation that News Corp. might be interested in some kind of deal started
just days after Microsoft's initial bid, spreading
much wider earlier this week. The WSJ story is the first apparent
confirmation of the rumor.
Neither company has commented directly on the report.
Yahoo formally
rejected Redmond's combined stock-cash bid of approximately $42 million
on Monday, to which Microsoft quickly responded that it "reserves the right
to pursue all necessary steps to ensure that Yahoo's shareholders are provided
with the opportunity to realize the value inherent in our proposal" -- including, analysts speculate, a hostile takeover effort.
Microsoft appears to be moving forward in that front; the New York Post is reporting that Microsoft has hired a firm to contact shareholders directly to gauge their response to the bid.
And some shareholders aren't waiting for the action to reach them; on Tuesday,
Yahoo's second-largest shareholder released
a statement encouraging Microsoft to up its bid from approximately $31 to
$40 per share. And at least one shareholder has filed
suit against Yahoo for rejecting the deal.
Meanwhile, another door that once seemed open to Yahoo, Google, appears to be shutting; according to another WSJ story, Google's "enthusiasm has waned" since its initial offer to help Yahoo fight off Microsoft.
Despite all the interest in Yahoo, the company is going forward with its previously
announced plans to reorganize, including laying off 1,000
employees this week.