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Microsoft to buy Yahoo online search

Posted by sudhirmangla December 1, 2008

Software major Microsoft is in discussions to buy the online search business of Yahoo for about 20 billion dollars, media report says.

A few months back, Yahoo had spurned a takeover bid from Microsoft worth more than 47 billion dollars.

It is thought that Jonathan Miller, ex-chairman and chief executive of AOL, and Ross Levinsohn, a former president of Fox Interactive Media, have been lined up to lead the new management team. Senior directors at Microsoft and Yahoo are understood to have agreed the broad terms of a deal, but there is no guarantee that it will succeed.However Yahoo is under intense pressure from its investors after rejecting the offer from Microsoft. This valued each share at $33. Since then Yahoo’s price has tumbled to a low of $9 per share."

The Sunday Times said that under the terms of the proposed transaction, Microsoft would provide a five-billion dollar facility to the Miller and Levinsohn management team. The duo would raise an additional five-billion dollar from external investors.

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