The Yahoo acquisition rumor mill has been sent buzzing again with the news that Microsoft signed a non-disclosure agreement with Yahoo, which would allow Microsoft to gain more detail on Yahoo’s assets but prevent Microsoft from talking to other potential bidders, according to the New York Times Dealbook.
Not only that, but in a savvy move, before it signed the non-disclosure agreement, Microsoft in October held talks with other potential bidders, including Silver Lake and the Canadian Pension Plan Investment Board, about teaming up to buy part or all of the struggling Yahoo, Dealbook reported.
Microsoft reportedly has two major reasons for buying Yahoo, one of them defensive and the other offensive. The defensive maneuver would be maintaining the Microsoft-Yahoo search teamup, established in 2009, which outsourced all of Yahoo’s search share to Microsoft while still permitting Yahoo to sell ads. Now Microsoft apparently wants Yahoo’s sales team to continue to sell ads for Bing search results.
Meanwhile, Microsoft is also said to be interested in merging other Yahoo user products (Mail?) with Skype, which Microsoft just purchased in May for $8.5 billion.
Yahoo’s board reportedly wants to have some sort of deal ironed out by January 7, the date that shareholders can send the board formal notice of who they want to nominate for the Yahoo board next year, Forbes reported. And there is pressure on the board to produce some sort of plan of action for turning the company around or face ouster from hedge fund company Third Way, which has a 5.1 percent stake in Yahoo and has openly expressed displeasure with the current board and an interest in shaking it up.
Yahoo’s board, it should be remembered, bluntly fired CEO Carol Bartz over the phone in September and has yet to nominate a replacement.
This would hardly be the first time Microsoft has attempted to acquire Yahoo, with two high-profile acquisition attempts rejected by Yahoo in 2008.
While the times have certainly changed and both companies have experienced a recent decline in fortunes, it remains to be seen whether the outcome in this case will be any different.
