Hot on the heels of news that Microsoft is preparing to finance a bid for troubled web giant Yahoo, Google is reportedly getting ready to rain on Microsoft’s parade with a bid of its own.
The Wall Street Journal - which has revealed much of the information behind the Microsoft bid – reports that Google is also in discussions with private equity firms to finance the purchase of Yahoo’s core business. The Journal reports that Google’s major interest in Yahoo is, unsurprisingly, related to advertising opportunities across Yahoo’s many websites.
Financing private equity firms (or other third parties intending to submit bids) isn’t the same as Google (or Microsoft, for that matter) submitting its own bid to buy Yahoo outright, and might help Google to avoid at least some of the antitrust hassle it would inevitably face if it tried to eat up Yahoo in one big gulp on its own.
It’s also possible though that Google is simply holding discussions to review its options, or even just going through the motions, perhaps with the intention of pushing up Yahoo’s price for other buyers, or forcing other potential bidders, like Microsoft, to submit a premature bid and pay over the odds. It’s widely believed that a potential Microsoft bid for Motorola Mobility (and its patents) forced Google’s purchase of that company at an inflated price earlier this year. It’s not a big leap to suggest that Google might wish to return the favour; Google’s not above playing silly games when it comes to making bids on big companies and assets, after all – it made a number of seemingly nonsensical bids, including one for ‘pi billion dollars’ ($3.14159bn), for Nortel’s patents against Apple and Microsoft, which some believe was just a play to force up the price of the patents for the eventual winners.
It’s good to see the giants of the industry fighting over Yahoo – perhaps its acquisition will finally reverse its long, slow, painful decline into obscurity and irrelevance. On the other hand, perhaps that’s just too much to hope for.