Daily Mail eyes up Yahoo

The Daily Mail and General Trust (DMGT), the owner of the Daily Mail, is considering a bid for ailing search engine Yahoo. Yahoo has been left behind by the current dotcom boom. Its revenue is falling: advertisers are pumping money into online advertising, but most of it is going to Facebook and Google. The firm is valued at $35bn, but $29bn of that is due to the value of its shareholding in Alibaba, the Chinese e-commerce site.

Now, following a failed attempt to break up its business, it has put itself up for sale. It’s an odd sales process, says Matt Levine on Bloomberg – Yahoo is taking a “choose-your-own-adventure” approach, inviting bidders to pitch for any part of its business. Its complex cross-holdings in Alibaba and Yahoo Japan have turned the company into a puzzle, which it hopes bidders – including Time and dating app Tinder – will solve.

Yet Yahoo still has its attractions. Its online business is vast. In February it was the third most visited website in America, with 204 million users, just 1% behind Facebook. Its patent portfolio could fetch $3bn to $4bn, says The New York Post. Yahoo also owns blogging site Tumblr and photo-sharing site Flickr. And it could be a good fit for the Mail, at the right price.

Both Yahoo and the MailOnline have “shared obsessions” with scandal and celebrity gossip, says Jasper Jackson in The Guardian. With £700m of debt and a pension deficit, DGMT lacks the firepower for a hefty deal, but a deal over Yahoo’s media business could “turbocharge” the Mail’s ambitions to grow in America.

Merryn

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