A Yahoo and Microsoft deal? Search me
Two days ago, Microsoft CEO Steve Ballmer said Yahoo should team up with his company on search so they can take on Google. That’s not a new idea; after all, Ballmer’s been talking about a search deal of some sort at every public forum for months.
But then, Yahoo CFO Blake Jorgensen sent out a message loud and clear the following day, endorsing the idea of a search partnership. Yahoo is “not opposed” to doing a deal on search, he said, adding that such a deal could be in the form of a partnership or a sale of it search business. When Carol Bartz took over as Yahoo CEO last month, she said her first instinct was to hold on to search, but of course, “everything is on the table.”
So could something be brewing on that front?
Collins Stewart’s Internet analyst Sandeep Aggarwal thinks so. In a research note today, Aggarwal writes the “posturing” from both sides suggests that a search deal is in the offing:
Less than 36 hours after Microsoft’s CEO mentioned about increasing likelihood for a possible MSFT/YHOO search deal due to recent management changes at Yahoo (new CEO), yesterday Yahoo’s CFO essentially not only expressed Yahoo!’s interest in a search deal but also publicly set the stage for some possible negotiations with Microsoft. As we highlighted several times before, we continue to believe that a MSFT/YHOO search deal is very likely and appears to be a near-term event. We believe that a search deal with Microsoft can provide $8 to $10 per share lift to Yahoo.
Aggarwal even goes so far as to suggest that the next step for a possible search deal between Microsoft and Yahoo is the deal announcement itself. Do you think Ballmer and Bartz will be shaking hands soon?
Keep an eye on:
- Don’t write off Steve Jobs yet. Apple tells shareholders he will return. (New York Times)
- Gannett slashed its dividend 90 percent, but if you’re an investor in publishing companies, maybe you’re just happy it didn’t get scrapped entirely. (USAToday)
- Cablevision posts a loss on Newsday writedown. (Reuters)
- If Apple can make mobile phones, why can’t Nokia make laptops? (Reuters)