While the proposal from Microsoft is just dumb, this deal from News Corp. and a private equity firm sounds like it might actually make sense:
News Corp. and Yahoo Inc. are in discussions about combining MySpace and other News Corp.-owned online properties with Yahoo, according to people familiar with the matter. The discussions are aimed at helping Yahoo fend off Microsoft Corp's unsolicited takeover offer, which was initially valued at $44.6 billion. Under the deal being discussed, News Corp. would get a stake in Yahoo which could be more than 20%.
This takes one content company (News Corp.) and adds another (Yahoo). Yahoo has a number of interesting content businesses, and I think they would "fit" better with News Corp. than with MS.
This also explains why Yahoo didn't just jump at the MS offer (which was very generous): they knew something that would be a better fit was lurking.
Technorati Tags:
synergy, yahoo, myspace