A new wrinkle: Microsoft could take 'minority, passive stake' in Yahoo

A report from Reuters says the search giant may want a piece of the Silicon Valley company, even after it buys the search business.

With the Microhoo drama back in overdrive Monday, investors may be scrambling to figure out what buying a "minority, passive stake" means.

Reuters is quoting a source saying Microsoft is considering buying Yahoo's search business andtaking a "minority, passive stake" in Yahoo once Yahoo has spun off its Asian assets. That's not a direct quote from the source, that's how the Reuters reporter described it.

This is a new wrinkle in the barrage of coverage for two reasons: It's likely the first time anyone has reported Microsoft would be interested in taking what sounds like a backseat at Yahoo (in addition to buying the search business ). And it adds to earlier rumors that the Chinese search site Alibaba wanted Yahoo to sell its stake in Alibaba to keep it from Microsoft. Some speculate Softbank could be interested in buying that stake.

Like many other Microhoo rumor reports, take this one for what it's worth: Reuters reports the proposal is "little more than an outline of Microsoft's thinking," and does not yet include a value for Yahoo's search business. Of course, Yahoo is still believed to be in partnership talks with Google on the search business, as well.

Does Yahoo suddenly find itself, despite threats from corporate raider Carl Icahn , with two search suitors it can play off one another?

Tech Culture
About the author

Jim Kerstetter has been writing about the high-tech industry since the 1990s. He has been a senior editor at PC Week and a Silicon Valley correspondent at BusinessWeek. He is now senior executive editor at CNET News. He moved back to Boston because he missed the Red Sox. E-mail Jim.


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