It seemed like a welcome relief when Microsoft walked away from the Yahoo deal, but the company has now got heavily involved with "billionaire investor Carl C. Icahn," which seems like a way to pick up Yahoo's search business on the cheap.
During skirmishes over the weekend, Yahoo rejected a new search-related deal, while Microsoft declined to buy Yahoo at the old $33 price, have already made several higher offers. According to The New York Times:
But the offer proved tough for Yahoo to swallow, these people said. It would have effectively led to the sale of Yahoo's search advertising business to Microsoft, leaving the remaining operations in Mr Icahn's hands. Yahoo also believed that the promised revenue of the latest offer [$2.3 billion a year] was less than it would earn through the Google partnership.
The latest deal would also have replaced Yahoo's board, which seems to be a big part of Icahn's game plan. So the question now is whether Yahoo's shareholders will do that. Yahoo's annual shareholder meeting is scheduled for August 1, so we may soon find out.
Any deal with Microsoft could, of course, be delayed by regulatory investigation, and the Yahoo/Google deal is already being investigated by US anti-trust regulators. So it looks as though we may be stuck with this farrago for at least a few more months.
