{"id":24690,"date":"2011-10-24T15:19:21","date_gmt":"2011-10-24T19:19:21","guid":{"rendered":"http:\/\/countingpips.com\/fx\/2011\/10\/24\/google-bidding-for-yahoo-%e2%80%93-is-the-interest-real\/"},"modified":"2011-10-24T15:19:21","modified_gmt":"2011-10-24T19:19:21","slug":"google-bidding-for-yahoo-is-the-interest-real","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2011\/10\/24\/google-bidding-for-yahoo-is-the-interest-real\/","title":{"rendered":"Google Bidding For Yahoo! \u2013 Is The Interest Real?"},"content":{"rendered":"

Google Bidding For Yahoo!: Is the Interest Real?<\/a><\/p>\n

by Justin Dove<\/a>, Investment U<\/em> Research
\nMonday, October 24, 2011<\/p>\n

Yahoo!<\/strong> (Nasdaq: YHOO<\/a>) is a hot rumor in mergers and acquisition activity lately. First, there was news that the Chinese e-commerce company Alibaba<\/strong> (OTC: ALBIY.PK<\/a>) was interested in a takeover.<\/p>\n

Then Microsoft<\/strong> (Nasdaq: MSFT<\/a>) was announced as a potential suitor three years after an unsuccessful attempt to take over the company.<\/p>\n

Now the latest rumors tab search-engine giant Google<\/strong> (Nasdaq: GOOG<\/a>) as a potential buyer. According to the reports, Google has talked to at least two private equity firms about potentially financing a deal.<\/p>\n

While there are certainly some valuable parts of Yahoo!’s franchise that may interest Google, it doesn’t seem probable that the interest is genuine.<\/p>\n

It sounds like Google is posing as a potential buyer in the hope of driving up the cost of the acquisition for its major rival, Microsoft.<\/p>\n

“Fake” Interest As a Tactic<\/strong><\/p>\n

Although it may sound a bit like a conspiracy theory, it’s a tactic used in business all the time.<\/p>\n

Baseball fans may remember that this past offseason the New York Yankees used “fake” interest<\/a> in Carl Crawford to help drive up the bidding price and ultimately force the Boston Red Sox to pay an inflated $142 million for a seven-year contract. New York General Manager Brian Cashman later admitted that the team had no real interest, but wanted to drive up the price tag.<\/p>\n

The rivalry between Google and Microsoft<\/a> is somewhat comparable to that of the Yankees and Red Sox. The two companies battle for talent and have increasingly overlapped each other’s markets.<\/p>\n

Just to name a few battlefields for the two companies:<\/p>\n