Talks of a Yahoo takeover seem, shall we say, greatly exaggerated
This article was originally on a blog post platform and may be missing photos, graphics or links. See About archive blog posts.
Yahoo has been at the center of a whirlwind of takeover talk that seems to have one goal in mind: pull one over on investors.
Over the weekend the Times of London published a widely debunked story about a $20-billion Microsoft search deal that had Jonathan Miller and Ross Levinsohn, both of venture capital firm Velocity Interactive Group, taking the reins of the struggling Internet giant.
Today the Wall Street Journal claimed that Miller has been trying to raise money from sovereign wealth funds and other investors in hopes of buying Yahoo and taking it private, raising expectations and the company’s stock price 7%.
People familiar with the situation have told us both stories are wrong. And it’s not much of a surprise, since neither story made much sense.
It is true that Miller and Levinsohn have for months talked to Yahoo and Microsoft executives and investors about Yahoo’s future and how best to reboot it. Both have been considered as board members for Yahoo at different times. It is also true that they have been trying to raise a new $300-million fund to invest in young start-ups. Which, if you ask us, seems a lot more plausible than trying to raise $30 billion to rescue Yahoo in this tough economic environment.
Another big hitch to the latest rosy scenario being floated: Miller, the former chief executive of AOL, is bound by a non-compete agreement until March, which means he can’t do anything without AOL’s say-so. And Time Warner decided to block his ascension to the Yahoo board in August. Miller is still under consideration to replace Jerry Yang as Yahoo’s CEO. Yahoo board members are interviewing potential candidates.
For the record, Velocity Interactive denied the first report in the Times. It’s not commenting on the second in the Wall Street Journal, which said Miller is trying to put together a deal to offer Yahoo shareholders between $20 and $22 per share, which would value Yahoo at about $30 billion.
But we aren’t the only ones to think that in this case, the stock market’s newspaper of record isn’t on the money.
-- Jessica Guynn