Doubts are emerging over a report that AOL is considering buying Yahoo, following the firing of Yahoo CEO Carol Bartz earlier this week. According to Bloomberg, AOL CEO Tim Armstrong is discussing the possibility with Yahoo advisers. However, doubts have been raised over the wisdom or likelihood of a merger of two embattled Internet firms. […]
Doubts are emerging over a report that AOL is considering buying Yahoo, following the firing of Yahoo CEO Carol Bartz earlier this week. According to Bloomberg, AOL CEO Tim Armstrong is discussing the possibility with Yahoo advisers. However, doubts have been raised over the wisdom or likelihood of a merger of two embattled Internet firms. CNBC has since reported that a “source close to Yahoo says no interest in a deal with AOL,” so this rumor may be nothing but wishful thinking on AOL’s part.
12/08/2011
In addition, Kara Swisher of All Things Digital reports that a number of her unnamed sources say AOL and its CEO Tim Armstrong have far too many problems of their own to be in condition to take on Yahoo’s as well.
Swisher terms a Bloomberg story published Friday afternoon about the possible combination of the company’s “the product of over-enthusiastic bankers essentially spinning a tale of hopes and dreams that has no basis in reality.”
Part of the story stems from the fact that both companies are using the same firm, Allen & Co. , to weigh their strategic options, which likely include possible sales and mergers.
Analysts were dubious about the chances for a Yahoo-AOL combination.
Meanwhile Colin Gillis, an analyst at BGC Partners, told Adweek: “Do they (Yahoo) really need a dial-up business? Do they need more page views? Do they need to pay $2 billion for a CEO? … Do they need to hire more sales people? The last thing they need is an acquisition like that. They need to focus on their own house.”
This isn’t the first time AOL and Yahoo have been linked. Yahoo was said to be considering a deal with AOL following its rejection of Microsoft’s unsolicited buyout offer in 2008. Last year, rumors again surfaced, focusing on a combination that would see AOL split its content and dialup subscription business, and merging the former with Yahoo.
