According to reports from the Wall Street Journal, the world’s number one search company Google is considering buying out the number two search engine Yahoo, with Microsoft reportedly considering another bid as well.
Apparently, a “person familiar with matter” has told the WSJ that Google has approached at least two private equity firms about helping finance a bid for Yahoo.
This all comes as last week Microsoft head honcho Steve Ballmer declared that Microsoft were “lucky” when their offer to buy Yahoo was blocked, having offered to pay $46 a share. Since then the market has subsequently crashed and Yahoo’s shares are now trading at around $25.
According to the WSJ report, Google is looking to push its Google + network through Yahoo and they’re also tempted by relationships Yahoo has with ABC News for its own advertising network, Double Click.
It’s unclear which firms Google has chatted with, but the company is still in the early stages with these conversations, and they haven’t yet drawn up a formal proposal. It’s possible Google won’t even end up making a bid, the source told the Journal.
Microsoft might have been very lucky that they didn’t buy Yahoo at the top of its market value, but they still have their eye on the company too.
Private-equity firm Silver Lake Partners is working with Microsoft to look to see whether another deal can be done. It would see Microsoft putting in several billion for funding and the banks covering the rest of the cost.
At the moment Yahoo is undertaking wide-ranging strategic review, but having two of the richest companies considering a buyout could be the beginning of an interesting battle between Google, Microsoft and other bidders.
Any deal that does happen will have to go through the standard anti-trust procedures, with Google and Microsoft most likely feel the brunt of any such scrutiny.