Yahoo eyes AOL deal

 

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By Stuart Turton

Posted on 11 Feb 2008 at 10:50

Yahoo may consider a merger with AOL in order to avoid the $44 billion hostile takeover by Microsoft, reports are suggesting.

The story, reported by the Times, claims that Yahoo is ready to restart talks with AOL, a deal which has apparently been on the table since 2005 but continually broke down over the valuation of AOL.

While such a merger would offer the companies a sizable presence in e-mail and internet messaging, it is difficult to see what other benefits it offers and analysts believe that the move could be intended to drive Microsoft's bid up to the $40 per share mark that Yahoo is holding out for.

Reports claim that Yahoo is on the verge of rejecting Microsoft's $31 per share bid as too low, giving the first indication that Yahoo is ready to negotiate.

Yahoo had no comment on the story at the time of writing.