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As anticipated, Yahoo! Inc. (NASDAQ: YHOO) and Google (NASDAQ: GOOG) announced a deal. The Wall Street Journal reports it's worth between $250 million and $450 million in additional cash flow to Yahoo.
The deal will be delayed a few months for regulatory approval. Under its terms, Yahoo will select which search term queries it offers Google paid search results for, the number and placement of Google results and how they are blended with its own results and those of other providers. Yahoo said either party can end the agreement in the event of a change in control. If control of Yahoo changes hands in the next 24 months, Yahoo must pay a termination fee of $250 million.
Poor Carl Icahn. He could have had a $33 a share deal from Microsoft Corp. (NASDAQ: MSFT), now all he has is 33 cents a share from Google. Cover your ears before his moaning and groaning begins. Yahoo shares are up 1% after hours after losing 10% during regular trading.
Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.
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Reader Comments (Page 1 of 1)
6-13-2008 @ 10:03AM
speculator said...
Sucks to be a yahoo share holder today. Icahn and all of his friend might be dumping their stock this morning. Balmer gets a lot of critism these day but I think he did the right thing. When going into a deal, you have to put a line in the sand or the next time you deal with someone, they wont take your price seriously. Now he can buy Yahoo on the open market at a much lower price and go hostile.
I think the market will be down over the next 2 years and one big reason is oil-it is like nasdaq in1998. I will tell you why @
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