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Since coming on board Yahoo! (NASDAQ: YHOO) early this year, Carol Bartz has wasted little time in making changes. Part of the strategy is to get the company more focused.
So, it looks like Yahoo! is in the process of selling its small business unit. All in all, it's a good asset, with web hosting, domain name services, and merchant accounts. The deal may also include the HotJobs division.
The problem is that it's a tough market to get traction. And, the margins can be fairly thin.
Yet, there appears to be interested suitors in the asset, including private equity funds as well as corporate buyers. But there is a big issue: as always, it's valuation. It appears that Yahoo! wants anywhere from $350 million to $500 million.
Oh, and it also looks like Yahoo! wants to sell its Zimbra property, which provides high-end web e-mail. The company purchased it back in 2007 for a cool $350 million.
Even though Zimbra is a fine product, it really doesn't make for a strategic fit. Can Yahoo! really be a player in the Office space against rivals like Microsoft (NASDAQ: MSFT) and Google (NASDAQ: GOOG)?
Again, Yahoo! may have issues on valuation with Zimbra as well. Yet, if the company is really serious about its renewed mission -- which is to focus on the consumer side -- then it means getting realistic about the price tags for its assets.
Tom Taulli is the author of various books, including The Complete M&A Handbook
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