Microsoft-Yahoo deal rumors are back

Two news media sources have again started the rumor of a possible acquisition of internet giant Yahoo by software giant Microsoft.

The reports said that the two companies have restarted their talks to potentially create a common entity which could take on Google effectively.

The rumors helped the Yahoo’s stock at the share market jump by around 17.96 percent to $33.24 in NASDAQ. Microsoft’s shares were down a bit.

Peter Lobravico, vice president of risk arbitrage sales/trading at brokerage Wall Street Access spoke about a possible deal between the two companies: “It’s been talked about for a long time, ever since Google came into the picture. I can’t imagine a more perfect deal. You can’t find a stronger buyer than Microsoft and while it would spur a lot of political and regulatory noise, everyone knows in the end that the deal would go through.”

The New York Post had placed a probably value of Yahoo at around USD 50 billion and said that talks are currently going on between the two companies for a possible deal.

Wall Street Journal too has a report saying that Microsoft and Yahoo are in early-stage talks about a merger or some kind of link-up.

Market analysts believe that such a deal would show how much the internet market has changed since the entry of Google which has single handedly managed to beat every other player in the search and advertising market.