Rumours of a Yahoo sale have intensified this week, with Microsoft, News Corp and an international conglomerate of Silver Lake, Chinese Alibaba and Russia’s Digital Sky considering bids for the embattled internet media firm, according to news reports. Reuters quotes sources saying that Microsoft is considering a fresh attempt to take control of Yahoo, more than three years after its first bid for the internet business failed.
The software giant launched a $44.6bn hostile bid for Yahoo in 2008 that was vigorously rebuffed by the company. Yahoo's share price has subsequently collapsed and the firm was valued at less than $18bn before Microsoft's renewed interest was reported.
Yahoo's shares soared by 10% on the rumour, which neither company would comment on, before falling back in after-hours trading. Peaking at $15.94, the shares were still barely half the value of Microsoft's $31-per-share offer in 2008.
Meanwhile, Bloomberg News reported that private-equity firm Silver Lake, Chinese Alibaba and Russia’s Digital Sky Technologies are considering teaming up to make a joint bid to take over Yahoo, in a deal that would almost certainly draw tough scrutiny from regulators.
In addition, the New York Times reported that News Corp has emerged as one of the most proactive suitors for Yahoo.
After ousting CEO Carol Bartz last month, Yahoo! has reopened the door to an acquisition and has been fielding potential offers.
According to Bloomberg News, the threesome of Silver Lake, Alibaba and Digital Sky Technologies has contacted Yahoo! and its advisers in recent weeks to talk about a potential bid, but the discussions are still at an early stage and there’s no guarantee an offer will emerge.
The reports come after Jack Ma, the chairman and founder of Alibaba, recently said he is “very interested” in buying Yahoo!, which owns a 40% stake in Alibaba.
However, a takeover by Alibaba, DST and Silver Lake would essentially hand control of the most visited U.S. web portal and second-largest search service over to Chinese and Russian companies.
The three are already bracing for potential opposition to foreign ownership of a communications company, Bloomberg News reported.
Meanwhile, News Corp. has contacted Yahoo! and several financial firms, including Silver Lake, about a possible bid for the Times reported.