DealZone

The Yahoo lament

May 29, 2008

yang.jpgMicrosoft‘s $47.5 billion bid may not have met Yahoo’s price target, but the deal sure had a lot of promise, Yahoo’s Chief Executive Jerry Yang lamented during an on-stage interview at the D: All Things Digital conference. Yang said the software giant appears no longer interested in a full merger. “We did not walk away from that proposal. Microsoft did,” Yang said. This might just be a brave face for Yang, who will need one to face a potentially hostile board filled with activist agitators hand picked by Carl Icahn. Then again, Yang may feel emboldened by reports that Icahn may not be able to muster the votes to change Yahoo’s position. News Corp Chairman Rupert Murdoch, also at the D, was quoted by Dow Jones as saying: “Icahn? That’s not serious. It’s just a lot of helpful noise.”

Royal Bank of Scotland extended yesterday’s deadline for the auction of its insurance arm, which includes its Direct Line and Churchill brands, the Daily Mail reports. First-round bids for Britain’s largest motor insurer are expected to come within days, the paper said. RBS declined to comment on the auction for RBS Insurance, expected to be valued around 7 billion pounds ($13.8 billion). Italian insurer Generali, which had been seen as a strong candidate, pulled out of the running because of the hefty price and RBS’s unwillingness to consider breaking off parts of the unit, sources close to the situation told Reuters.

A member of the founding family of Anheuser-Busch said any talks with Belgian brewer InBev should be based on shareholder value rather than the Busch family’s legacy, the Wall Street Journal reports. The comments signal a hardening of the split within the family, which could embolden InBev to make a bid for the St. Louis brewer, the newspaper said. InBev is weighing an offer that could top $45 billion, the Journal reported, citing people familiar with the matter. “A possible merger is not a family issue,” Adolphus Busch IV, an uncle of CEO August Busch, wrote in a release to the newspaper. It is not “a matter of family solidarity or legacy. It is strictly a matter of shareholder value.”

Other deals of the day:

* Lottomatica, the world’s largest lottery operator, said it had agreed to buy an online betting concessionaire from Totosi Holding Srl in a deal worth about 41 million euros ($63.9 million).

* Australia and New Zealand Banking Group CEO Michael Smith said his bank is still in the running for Hong Kong’s mid-tier Wing Lung Bank and sees its fair price at closer to two times than three times its book value.

* Champion REIT said it plans to raise $1.66 billion through bond and unit sales as well as bank loans to fund its purchase of Langham Place office and retail complex from Great Eagle Holdings.

* U.S. investment company Harbinger Capital, the biggest shareholder in iron ore miner Murchison Metals Ltd, has built up a stake of 8.1 percent in rival miner Midwest Corp, the subject of a takeover battle between Murchison and China’s Sinosteel.

* Malaysia’s Petronas will buy a 40 percent stake in Australian energy firm Santos Ltd‘s Gladstone liquefied natural gas project in Australia for $2.51 billion, sending Santos’ shares up 10 percent.

* China’s top steelmaker, Baosteel Group, aims to boost cooperation with Australian iron ore producer Fortescue Metals Group Ltd, a senior executive said, although officials gave no clear indications on the possibility of an equity tie.

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