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Yahoo/AOL tie-up could thwart Microsoft takeover
Yahoo and Time Warner's internet division AOL are believed to be close to signing a deal to combine their operations, according to the Wall Street Journal.The move is designed to insulate Yahoo against an unwanted buyout by Microsoft, according to figures familiar with the matter.
However, it appears that Microsoft is considering stepping up its efforts to acquire its rival by teaming up with News Corp.
"One person apprised of the plan described the discussions as serious," the News Corp-owned Wall Street Journal wrote.
The terms of the Time Warner/Yahoo deal would see the former folding its AOL into Yahoo and investing cash, in return for around a fifth of the combined equity. It would value AOL at around $10 billion (£5 billion).
There is also speculation about a search Internet Advertising pact with Google, which together with the AOL deal could give Yahoo a way to possibly avoid Microsoft's takeover bid, or at least serve to drive a higher price from Bill Gates' firm.
Yahoo! News posted on 10 April 2008
