I was reading the wall street journal and came across and interesting article called:
Yahoo might long for M&A Do-Overs
If only the game of M&A had mulligans.
With its days as an independent company seemingly numbered, Yahoo must be wanting a few do-overs on the M&A front these days. Last yearâs purchases of online ad firms Right Media and BlueLithium seem astute, though perhaps too little, too late. And letâs not forget successful photo-sharing site Flickr. Still, here is a look at some of Yahooâs M&A missteps over the years. We paired deals Yahoo completed with ones it didnât.
1. GeoCities
Yahoo paid almost $3 billion in 1999 for GeoCities, a pioneer of social-networking on the World Wide Web, only to have the social-networking site whither away under its control. As one person close to the situation told Deal Journalâs Dennis K. Berman in this recent column: âHad they done things right with GeoCities, there would be no Facebook, YouTube or MySpace.â Which leads us toâ¦
Facebook or MySpace
Flash forward, almost a decade, and Yahoo finds itself flat-footed as such social-networking sites as MySpace and Facebook increasingly become rivals. Yahoo stood by as News Corp. gobbled up MySpace for $580 million. According to the latest Fortune, Yahoo had a $1 billion deal on the table for Facebook, which fell apart after it lowered its price to $850 million. If Yahoo hadnât lowered its price, then perhaps its share price doesnât tumble and then Yahoo isnâtâ¦well you see where weâre going with this.
2. Broadcast.com
This is perhaps the most famous of Yahooâs missteps. At $4.3 billion, the all-stock deal also is Yahooâs most expensive acquisition, according to Dealogic. Broadcast.com, a company that specialized in helping conventional radio stations extend their reach by broadcasting their signals over the Internet, never panned out and by 2002 Yahoo had shut it down. (On the plus side it produced ever-colorful billionaire sports-team owner Mark Cuban.)
YouTube
It is somewhat difficult comparing deals from different eras. But Yahoo was also in the running to purchase YouTube back in 2006. It fell into the hands of Google for $1.65 billion, and Yahoo still trails Google in Web video to this day.
3. Inktomi & Overture
By 2002, Google had gone from Yahoo partner to Yahoo rival. In response to Googleâs encroachment, Yahoo snapped up these two businesses to fight back. Search engine Inktomi replaced Google for Yahooâs search technology. Overture placed ads on Web pages. The problem was that Inktomi and Overture did not produce results as good as Googleâs. Which brings us toâ¦
Google
Yes, Google. Probably, the do-over Yahoo most fantasizes about. Yahoo had an opportunity to buy Google in 2001. Over dinner, Google co-founders Sergey Brin and Larry Page and former Yahoo CEO Terry Semel discussed a deal. Alas, Brin and Page wanted $3 billion to sell and Yahoo walked away, according to this Sunday Telegraph article. Today a $162 billion mulligan. Do we need to say anything more?
Link: http://blogs.wsj.com/deals/2008/02/13/yahoos-list-of-ma-do-overs/
I didnt see this article mentioned any where, if it is just delete this.
Just thought it would be a good article to share.
Yahoo might long for M&A Do-Overs
If only the game of M&A had mulligans.
1. GeoCities
Yahoo paid almost $3 billion in 1999 for GeoCities, a pioneer of social-networking on the World Wide Web, only to have the social-networking site whither away under its control. As one person close to the situation told Deal Journalâs Dennis K. Berman in this recent column: âHad they done things right with GeoCities, there would be no Facebook, YouTube or MySpace.â Which leads us toâ¦
Facebook or MySpace
Flash forward, almost a decade, and Yahoo finds itself flat-footed as such social-networking sites as MySpace and Facebook increasingly become rivals. Yahoo stood by as News Corp. gobbled up MySpace for $580 million. According to the latest Fortune, Yahoo had a $1 billion deal on the table for Facebook, which fell apart after it lowered its price to $850 million. If Yahoo hadnât lowered its price, then perhaps its share price doesnât tumble and then Yahoo isnâtâ¦well you see where weâre going with this.
2. Broadcast.com
This is perhaps the most famous of Yahooâs missteps. At $4.3 billion, the all-stock deal also is Yahooâs most expensive acquisition, according to Dealogic. Broadcast.com, a company that specialized in helping conventional radio stations extend their reach by broadcasting their signals over the Internet, never panned out and by 2002 Yahoo had shut it down. (On the plus side it produced ever-colorful billionaire sports-team owner Mark Cuban.)
YouTube
It is somewhat difficult comparing deals from different eras. But Yahoo was also in the running to purchase YouTube back in 2006. It fell into the hands of Google for $1.65 billion, and Yahoo still trails Google in Web video to this day.
3. Inktomi & Overture
By 2002, Google had gone from Yahoo partner to Yahoo rival. In response to Googleâs encroachment, Yahoo snapped up these two businesses to fight back. Search engine Inktomi replaced Google for Yahooâs search technology. Overture placed ads on Web pages. The problem was that Inktomi and Overture did not produce results as good as Googleâs. Which brings us toâ¦
Yes, Google. Probably, the do-over Yahoo most fantasizes about. Yahoo had an opportunity to buy Google in 2001. Over dinner, Google co-founders Sergey Brin and Larry Page and former Yahoo CEO Terry Semel discussed a deal. Alas, Brin and Page wanted $3 billion to sell and Yahoo walked away, according to this Sunday Telegraph article. Today a $162 billion mulligan. Do we need to say anything more?
Link: http://blogs.wsj.com/deals/2008/02/13/yahoos-list-of-ma-do-overs/
I didnt see this article mentioned any where, if it is just delete this.
Just thought it would be a good article to share.
