Google, Microsoft Considering Yahoo Bid

But neither actually wants to run the company

As the number of potential Yahoo bidders continues to grow, here are two more to add to the list: Google and Microsoft. According to The New York Times, both companies are considering a play for the beleaguered Internet giant in order to keep it alive.

But since neither company actually wants to buy or run Yahoo, sources say that they’re considering giving their financial support to private equity firms or other possible Yahoo bidders.

Microsoft is reportedly in talks with “a number of leveraged buyout firms,” and is discussing one plan that would require lending “billions of dollars” to a consortium of investors led by Silver Lake and the Canadian Pension Plan Investment Board. If it were to make a substantial investment in Yahoo, Microsoft could expand its current deal with the company beyond its Bing integration to include its recent acquisition, Skype.

Google, meanwhile, is said to be in the early stages of talks with two private equity firms. With its own deal, sources said that Google could be looking to eventually take over the Yahoo’s search business when its partnership with Microsoft expires and service its advertising inventory with its DoubleClick ad service. Although a Yahoo-Google deal could face tough antitrust scrutiny from government regulators, says the Times, Google could be getting involved solely in order to drive prices up and make a bid more difficult for Microsoft.