Will MSFT Push Yahoo to Buy Facebook

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Will MSFT Push Yahoo To Buy Facebook?

By: Mathew Ingram
2007-09-25

According to the Wall Street Journal, the software behemoth known as the Beast from Redmond is looking at buying between three and...

...five per cent of Facebook for between $300-million and $500-million. As any math whiz (of which I am not one) could tell you, that would value the company at about $10-billion, which would make Facebook backer Peter Thiels wish come true.

I know that there have been plenty of rumours out there about Facebook and Yahoo, Facebook and Google, Facebook and my Aunt Sally " you name it. But while the Journal may be getting a little scrappier now that its owned by Rupert Get in here so I can fire you Murdoch, its still the Journal and so it has to be taken seriously.

Although the WSJ talks about this sparking Google to pony up for Facebook, however, I think the more interesting question is whether it will light a fire under the new regime over at Yahoo. Presumably they got rid of Terry Semel so that they could actually get off their duffs and do something about that peanut butter memo and all of the valid criticisms it contained.

Making a big bet on social networking could be just the thing it needs to fire a shot across Microsoft and Googles bows. And my friend Paul Kedrosky thinks Yahoo is a likely bidder too.

Update:

I realize " as Joe Duck points out in the comments below " that $10-billion is almost a third of Yahoos market capitalization. As 24/7 Wall Street puts it, thats because Facebook is growing and Yahoo! is not. That doesnt put it out of Yahoos reach, however, thanks to the magic of stock-and-debt offerings. Whether it would be wise or not is a different question.

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Tag: Microsoft, Yahoo, Facebook

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About the Author:
Mathew Ingram is a technology writer and blogger for the Globe and Mail, a national newspaper based in Toronto, and also writes about the Web and media at www.mathewingram.com/work and www.mathewingram.com/media.


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