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A report in The Sunday Times (of London) late today outlines a complex potential deal betwixt Microsoft, a pair of digital media heavyweights and Yahoo, but that several elements in the fib don’t add up and already one of the principals has denied knowledge of such a deal.

“SOFTWARE giant Microsoft is in talks to acquire Yahoo’s online investigation business on the side of $20 billion (13 billion pounds),” reads the opening paragraph of the invention, dated Sunday.

Before we off with you much further: Why would Microsoft do a $20 billion deal as antidote to Yahoo’s online search business — certainly something that Microsoft has coveted — when all of Yahoo is value merely $15.96 billion.

The story, which quotes no source by distinction and is written in that unrefined passive voice (”it is thinking”) that screams thinly sourced, goes without interruption to describe a complex business that would install former AOL Chairman and CEO Jonathan Miller and former Fox Interactive Media President Ross Levinsohn similar to leaders of a new management team — presumably of Yahoo, though the statement doesn’t statement so explicitly.

However, VentureBeat is reporting that Levinsohn is not persuaded of any such deal: “We’ve reached audibly to Levinsohn who says of the Times Online report: ‘No truth to it. News to us.’ ”

The Times story continues: “Senior directors at Microsoft and Yahoo are understood to have agreed the broad terms of a deal, but there is no guarantee that it inclination succeed.”

A Microsoft spokesman uttered via e-mail late Saturday that the company had nothing to add beyond CEO Steve Ballmer’s comments at the company’s shareholder meeting. During the Nov. 19 shareholder meeting in Bellevue, Ballmer said, “We are done with all acquisition discussions with Yahoo,” but left open the possibility of a “search collaboration” between the two companies. “[T]in the present life’session no active discussion on that front, but we’d be very open to it,” Ballmer said. Microsoft also made no make notes to The Sunday Times.

The Times invention describes a transaction that would put the search business in Microsoft’s hands, though as I said earlier, the numbers don’cheek by jowl make much sense (and I’ll add the caveat that I’m whole tryptophaned out, so who knows):

“Microsoft would provide a $5 billion facility to the Miller and Levinsohn management team. The duo would raise every additional $5 billion from external investors.

“This cash would be used to buy convertible preference shares and warrants which would give it a holding in excess of 30% of Yahoo.

“The external investors would also be in possession of the right to appoint three of Yahoo’session 11 board directors. The talks with Yahoo contain Microsoft obtaining a 10-year operating agreement to manage the search business. It would also receive a two-year call selection to corrupt the explore profession for $20 billion. That would leave Yahoo to run its own e-mail, messaging, and content services.”

I’ll be keeping one bud on this Sunday and updating as appropriate. Meanwhile, be delighted with the rest of your Thanksgiving weekend.


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