A couple of months ago I wrote “A Few Thoughts on Yahoo” a blog discussing Yahoo and the sad state it had fallen into. Since then the talks of a take over, and Jerry Yang’s efforts to avoid one have been floating about.
It looks like Marc Andreessen’s firm may be thinking of making an offer and installing Jeff Jordan to run the firm. It looks like Thomas H. Lee Partners may be thinking of making a $5 Billion offer for Yahoo’s U.S. operations, while Alibaba Group may be trying to round up financing to make a $4 Billion offer for Yahoo’s Asian operations. It’s not a lot t0 go on, but that roughly adds up to a $9 Billion valuation on the company. On top of it all, it looks like Jerry Yang is attempting to prevent anyone from buying the company. That probably explains why the company still has a $19 Billion market cap.
However, having a somewhat differing sense of perception, I think what we are being told is that Yahoo’s business is very likely to significantly deteriorate before Jerry Yang is removed and the company is sold. In other words, the shares of Yahoo are a sell at current price levels.