Report: News Corp, Yahoo discuss joining forcesRupert Murdoch's media conglomerate is reportedly in talks to merge MySpace, other online properties with Yahoo and take a stake in combined company.Video
NEW YORK (CNNMoney.com) -- News Corp. and Yahoo are in talks about combining MySpace and other News Corp.-owned online properties, according to a report in The Wall Street Journal Wednesday. The deal under discussion would give News Corp a stake in Yahoo (YHOO, Fortune 500) that could top 20%, according to the report. A News Corp-Yahoo alliance would help the Internet search engine fend off a $44.6 billion unsolicited buyout attempt by Microsoft (MSFT, Fortune 500). A spokeswoman for Yahoo told Fortune that the company does not comment on "rumors or speculation" but confirmed that Yahoo is looking at multiple options beyond Microsoft's bid. Yahoo rejected Microsoft's offer on Monday, saying that the bid "substantially undervalues" Yahoo. Spokespeople for News Corp. and Fox Interactive Media, the News Corp. unit that owns MySpace, were not immediately available for comment. News Corp. also owns The Wall Street Journal. The two companies have been considering joining forces in some way for 18 months, the report indicated. The deal could involve contributions from News Corp (NWS, Fortune 500) and a private equity firm, according to the report. Placing a value on MySpace could complicate the matter, since previous discussions have fallen apart over disagreements on what the social networking site is worth. News Corp is likely to push for a valuation of between $6 billion and $10 billion for MySpace, the Journal said. News Corp. chairman and CEO Rupert Murdoch also said during an earnings conference call earlier this month that News Corp. would not bid for all of Yahoo. Shares of Yahoo and Microsoft rose Wednesday while News Corp.'s stock fell. Fortune reporter Michal Lev-Ram contributed to this report. |
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