Microsoft is in talks to acquire Yahoo’s online search business for $20 billion, reports The Sunday Times. But this report has been described as “total fiction” by Ross Levinsohn, one of the two key players who were to play a major role in the reported Microsoft-Yahoo deal, according to BoomTown . BoomTown says it has also spoken to top sources at Yahoo and Microsoft and all scoff at such a deal now taking place or that either side has been in any such discussions of late.
Under the talk proposal as reported by The Times, Microsoft would support a new management team -- led by Jonathan Miller, ex-chairman and CEO of AOL, and Ross Levinsohn, a former president of Fox Interactive Media -- to take control of Yahoo. Under the proposal, Microsoft would also provide a $5 billion facility to Miller and Levinsohn who would raise an additional $5 billion from external investors to buy over 30 per cent of Yahoo shares.
The talks with Yahoo involve Microsoft obtaining a 10-year operating agreement to manage the search business. It would also receive a two-year call option to buy the search business for $20 billion. That would leave Yahoo to run its own email, messaging, and content services. It is expected that the operating agreement would boost Yahoo’s income by as much as $2 billion per annum, informs The Times.
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