Yahoo Buyers Circling, Stock Clinging to $20
We believe Yahoo (YHOO) management is not interested in selling the company, but the Post rightly observes that, at this price, a potential buyer might make an offer Yahoo can't refuse (fiduciary duty to shareholders, etc.)
The Post reports that private equity firms in particular have been sniffing around in recent days, and suggests that strategic buyers who have looked at Yahoo in the past--AOL, AT&T, CBS, Comcast, Microsoft, Viacom and News Corp--might decide to have another go.
Of these buyers, Microsoft and AOL still make by far the most strategic sense, but a Microsoft deal would likely destroy the company. (See the litany of reasons here). An AOL combination would be smart (see below), but the buyer should be Yahoo, not AOL, and this deal gets less and less likely as Yahoo's stock drops.
So the most likely buyer here is probably private equity. And it's not hard to guess what a big PE buyer would likely do: Go private, lever up, pay a huge one-time cash dividend, fire a couple thousand people, sell off everything but the core business, and go public again.
Inasmuch as that particular turnaround plan would benefit the private equity buyer, not us, we'd rather stick with Jerry, David, and Sue. So we're glad they appear to be getting more aggressive about their own turnaround plan.
Microsoft-Yahoo:
How to Structure a Microsoft-Yahoo Deal
One Problem With a Microsoft-Yahoo Deal: MSN is Only Worth $10 Billion
Proof that Microsoft Plans to Buy Yahoo?
AOL-Yahoo:
Playing the AOL-Yahoo-Microsoft Chess Game
Why Yahoo Should Buy AOL
Why Microsoft Will Steal AOL from Yahoo
The Web War is Over and Microsoft Lost:
MSN: Still Sucking Wind After All These Years
Disclosure: Henry Blodget has long-term positions in Yahoo, Time Warner, and Microsoft
The Post reports that private equity firms in particular have been sniffing around in recent days, and suggests that strategic buyers who have looked at Yahoo in the past--AOL, AT&T, CBS, Comcast, Microsoft, Viacom and News Corp--might decide to have another go.
Of these buyers, Microsoft and AOL still make by far the most strategic sense, but a Microsoft deal would likely destroy the company. (See the litany of reasons here). An AOL combination would be smart (see below), but the buyer should be Yahoo, not AOL, and this deal gets less and less likely as Yahoo's stock drops.
So the most likely buyer here is probably private equity. And it's not hard to guess what a big PE buyer would likely do: Go private, lever up, pay a huge one-time cash dividend, fire a couple thousand people, sell off everything but the core business, and go public again.
Inasmuch as that particular turnaround plan would benefit the private equity buyer, not us, we'd rather stick with Jerry, David, and Sue. So we're glad they appear to be getting more aggressive about their own turnaround plan.
Microsoft-Yahoo:
How to Structure a Microsoft-Yahoo Deal
One Problem With a Microsoft-Yahoo Deal: MSN is Only Worth $10 Billion
Proof that Microsoft Plans to Buy Yahoo?
AOL-Yahoo:
Playing the AOL-Yahoo-Microsoft Chess Game
Why Yahoo Should Buy AOL
Why Microsoft Will Steal AOL from Yahoo
The Web War is Over and Microsoft Lost:
MSN: Still Sucking Wind After All These Years
Disclosure: Henry Blodget has long-term positions in Yahoo, Time Warner, and Microsoft
Now as an EVP Biz Dev for a growing publisher, I have called 5 people over there to get a links deal done. One retuned my call (an old friend). He tried to hook me up with the right people. No answer.
I assume Google will be more interested
As a stock holder I hope they can get $40 but they better get it quick.
Hard to say what a PE firm would offer. I would think it would have to be over $30 for the company to take it seriously (given that the stock was there only a few months ago).
Speaking as a shareholder, I'd be pissed as hell if they sold for less than $30-$40 (and even that is a pathetic fraction of what I think the company could be worth if it were firing on all cylinders again.) And it's hard to see a PE firm being excited about forking over that month. More likely, they would offer $25-$30 and put Jerry, et al, in a really tough bind.
what would a PE firm offer? i don't really know.