So Microsoft is now proposing a new deal: This one could be some sort of partnership or joint venture for search-related advertising to take on Google Inc, the New York Times reports.
Just one problem. Carl Icahn doesn’t appear to be hot on the idea. Reuters, citing a person familiar his with the financier’s thinking, reports that this latest talk about an partial Microsoft-Yahoo alliance could prompt the billionaire investor to press Yahoo to further pursue a deal with Google.
“Microsoft is trying to get the milk without buying the cow, and if you look at Icahn’s history, he has never been used that way,” said this person. “He does not want to see Yahoo pushed into some joint venture with Microsoft and is not going to be used to push Yahoo into it.”
Icahn launched a proxy campaign last week to replace Yahoo’s board, saying it acted irrationally in refusing Microsoft’s $47.5 billion bid.
Icahn’s presence further complicates the Yahoo situation. He’s accumulated 59 million shares and options in Yahoo and has the support of Paulson & Co, a $30 billion hedge fund that has amassed a 3.4 percent stake in Yahoo, and other investors upset by the board’s handling of negotiations with Microsoft.