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Yahoo Loses Leverage as Google Ad Deal Fades

Posted Feb 13, 08 7:13 AM CST in Business,  Technology 

(Newser) – A potential advertising deal linking Google and Yahoo is losing steam because of Google's concerns over regulatory scrutiny, reports the Wall Street Journal, and that in turn removes one lever Yahoo hoped to use to boost Microsoft's buyout bid. Yahoo’s second largest shareholder, meanwhile, said yesterday that Microsoft’s takeover likely will succeed, but at a higher price than the $41.7 billion, or $31 per share, offered.

The proposed agreement with Google to outsource some advertising would provide a cash boost to Yahoo, helping drive up its value, but would risk regulatory review because of the market share the two companies control. Legg Mason placed Yahoo’s value near $40 per share, and at least one major shareholder said an offer over $35 would likely trigger the deal.

Source Wall Street Journal

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The reception desk is shown at Google's New York offices on Thursday, Jan. 31, 2008. Google Inc. says Microsoft Corp. could use its proposed $42 billion acquisition of Yahoo Inc. to gain illegal control...   (Associated Press)
Chinese subway riders walk past a Yahoo advertisement at a metro station in Beijing, in this March 12, 2006 file photo. Yahoo Inc.'s rejection of Microsoft Corp.'s unsolicited takeover bid left investors...   (Associated Press)
This combination of two photos shows Microsoft founder Bill Gates, left, and Yahoo CEO Jerry Yang. Microsoft Corp. on Friday, Feb. 1, 2008 pounced on slumping Internet icon Yahoo Inc. with an unsolicited...   (Associated Press)
Microsoft chairman Bill Gates smiles during his keynote speech at the Consumer Electronics Show in Las Vegas on Jan. 6, 2008. Google Inc. says Microsoft Corp. could use its proposed $42 billion acquisition...   (Associated Press)
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