Google’s Yahoo Rebound Play

With Microsoft out of the picture, Web search king Google strikes a search ad deal with Yahoo. But where does that leave the struggling portal?

After more than four months of Sturm und Drang, the blockbuster Internet deal of the year is over, with only one clear winner: Google. On June 12, Microsoft and Yahoo said they ended talks that focused on, at turns, an outright takeover by the software giant to a combination of the companies’ Web-search operations. Within hours, Google swooped in with a long-discussed alternative deal that involves placing search ads on Yahoo pages.Despite hints before the market closed that a Google deal might finally come to pass, the sudden end of chances for a more sweeping Microsoft transaction left Yahoo investors fleeing for the exits. The company’s stock fell 10%, to 23.52. That’s still considerably above the 19.18 where Yahoo’s shares sat just before Microsoft made its original $45 billion bid on Feb. 1, but far below the $33 a share Microsoft offered before bowing out.
http://businessweek.com/technology/content/jun2008/tc20080612_745212.htm

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