Microsoft and Yahoo rise on deal talks report

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(Agencies)
Updated: 2008-07-02 21:20

NEW YORK -- Shares of Yahoo Inc. and Microsoft Corp. rose in premarket trading Wednesday as the Wall Street Journal reported Microsoft has talked to other media companies about teaming up to buy Yahoo's search business.

In this June 15, 2006 file photo, Microsoft Corp. Chairman Bill Gates, right, looks at Microsoft CEO Steve Ballmer after Gates announced that he will transition from day-to-day responsibilities at the company he co-founded to concentrate on the charitable work of the Bill & Melinda Gates Foundation. Two years later, Microsoft's iconic frontman is finally giving up his full-time gig at the company to devote more time to world health charity work. [Agencies]

The paper reported Microsoft has spoken to News Corp., Time Warner Inc. and others about a way to complete the proposed deal, which was first announced on Feb. 1. Microsoft ultimately withdrew a $47.4 billion bid for Yahoo in May.

The Journal suggested that Microsoft would buy Yahoo's Internet search business, and the rest of the company would be combined with another outlet, like News Corp.'s MySpace or Time Warner's AOL.

The talks were described as preliminary, and citing sources familiar with the talks, the Journal indicated Microsoft may be having difficulty finding a partner.

In premarket trading, shares of Yahoo climbed $1.89, or 9.4 percent, to $22.09. The stock finished at $20.20 Monday, and is trading at its lowest levels since late January. Microsoft shares gained 17 cents to $27.04.

Calls to both Microsoft and Yahoo were not immediately returned.