If it's January, it must be time to get the Microhoo rumor mill going again.
Shares of Yahoo!
Leaning on "sources with knowledge of the proposed transaction," Arrington is hearing that a group of investment bankers and Silicon Valley executives will offer to snap up Yahoo! in the mid-teens, borrowing money from Microsoft
The buyers will then hand over Yahoo!'s search business to Microsoft, giving the executives a college try with everything else.
It makes sense on paper. Everybody gets what they want. Yahoo! shareholders get put out of their misery at a slight premium. Microsoft gets the one piece of Yahoo! it needs to take on Google
The rub is that there is no such thing as a win-win-win deal, beyond a rare three-team trade in the NBA.
Like the three gold-hungry protagonists in The Treasure of the Sierra Madre, it won't be long before they start turning on one another.
Microsoft will begin to wonder why it isn't the one calling the shots, buying Yahoo!, and then distributing the booty. Yahoo! shareholders will wonder why the company doesn't carve itself up to unlock the value that everyone else sees in it.
The worst scenario, though, would be if this is all true. Silicon Valley honchos would want in. Microsoft would be wearing a "Will Lend for Search" sandwich board. However, then Yahoo! shareholders would begin to believe that their company is worth far more than it really is. It would be 2008 all over again.
In the end, it's just one more rumor to warm the fire. How likely is it that a consortium of industry vets is plotting this, when a publicly traded company like Time Warner
I've said it before, and I'll say it again: Microsoft hasn't gotten over Yahoo! I just can't see it playing itself out this way. It will happen, and ideally soon, given how Microsoft continues to lose market share in search.
To paraphrase the fake Mexican federales in The Treasure of the Sierra Madre: "Buyouts? We don't need no stinkin' buyouts."
Oh, but you do, Microsoft. You do, Yahoo!
For related Foolishness:
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