Reuters is reporting that Microsoft and Yahoo! are talking again. Apparently sources from each company have confirmed the talks. The report also mentions that: "The information we have is thin, but what one source is saying [is] that Microsoft is talking a price lower than the $33 they were offering when the talks disintegrated in May." Maybe the thought of going below $20 a share, which seems to be a real possibility given the recent price action of their stock, not to mention the current market environment, has Yahoo! reconsidering their agreement with Google. Of course, Yahoo! does have an escape clause - but that would require them to merge with someone. If it is Microsoft, escape is free. If not, it will cost another company $250 million more to acquire Yahoo!, paid directly to Google. Maybe "Microhoo" is not dead yet. The incentives are certainly there. I imagine Carl Icahn is also actively banging the drum behind the scenes, still hoping to bring home a return for all his billionaire friends that lined up behind him, at least those that have not already added to the recent selling pressure.
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