Microsoft, Google, and Alibaba are allegedly all prepping potential bids for struggling Internet giant Yahoo, according to various reports. But questions remain about the validity of some of these bids and whether some companies are simply trying to fake out the competition.
Of the three, only Alibaba's interest is obviously real. That company's CEO, Jack Ma, has publicly stated his interest in acquiring Yahoo, which, oddly enough, is now the majority stakeowner in Alibaba, owning 40 percent of the company. Ma is currently seeking partners to help Alibaba finance the deal.
Microsoft, meanwhile, has publicly stated that it has no interest in purchasing Yahoo, and in a recent public appearance, CEO Steve Ballmer admitted that his firm dodged a bullet when Yahoo foolishly turned down an overvalued $45 billion bid in 2008; Yahoo's value and prestige has plummeted since then.
But Microsoft is allegedly being courted by investors from Silver Lake Partners and the Canada Pension Plan Investment Board, which are trying to pull together a consortium of companies to purchase Yahoo.
And now The Wall Street Journal reports that online giant Google and various private equity partners are putting together their own deal for Yahoo, perhaps simply in an effort to confound Microsoft or raise the price that the software giant and its own partners eventually pay for the firm. Google's bid is considered the least likely since it would face serious regulatory challenges and the notoriously flighty company is already infamous for spurious bids aimed at harming competitors.'
Yahoo previously tried to partner with the TV and movie streaming service Hulu, but negotiations fell through. That deal could have seen Yahoo emerge as a destination more oriented to entertainment than technology. And there are ongoing rumors of a link-up with America Online (AOL), which presumably operate under the theory that two wrongs will make a right.
Yahoo has been the subject of intense rumors and speculation since it suddenly and dramatically dumped its controversial CEO Carol Bartz a month ago, and the company said at the time that it would pursue various options, including a possible breakup or sale. And with interest growing in a possible sale, even Yahoo's sagging stock price has experienced a rebound in recent weeks, jumping from about $12 a few weeks back to around $16. That gives Yahoo a market value of roughly $20 billion. And for all its struggles, Yahoo has no debt.
Because of its increased value, analysts are now predicting that Yahoo could sell for as much as $20 a share. That's a nice premium over the company's somewhat artificially inflated stock price today, but a far cry from the $33 per share that Microsoft was offering back in 2008.