Microsoft has raised the possibility that it may make a new bid for rival Yahoo, less than two weeks after walking away from $46bn (£23.5bn) takeover talks.
The software giant said last night that it had proposed a broad marketing alliance between the two companies and might make a new bid if the talks go well. The U-turn came just days after rebel Yahoo shareholders launched a coup to try to oust the board and get a new team in place to talk terms with Microsoft.
Yahoo, which repeatedly spurned Microsoft's takeover offers, had no immediate comment on the new proposal, which was revealed in a brief statement from Microsoft yesterday.
It said it was "considering and has raised with Yahoo an alternative that would involve a transaction with Yahoo but not an acquisition of all of Yahoo". Microsoft's chief executive, Steve Ballmer, has for several years been keen to merge Yahoo with his company's loss-making MSN internet business, to better compete with Google.
An alliance that combines key aspects of the two companies' online advertising businesses would be a second-best option, and one fraught with difficulty for two groups that have an intense rivalry. But Mr Ballmer is concerned that Yahoo may instead sign an alternative deal with Google, with whom it has been trialling a technological alliance.
Google dominates the online advertising market, serving up almost two-thirds of all the ads that appear alongside search results on its own and other websites.
"Microsoft is not proposing to make a new bid to acquire all of Yahoo at this time," the statement added, "but it reserves the right to reconsider that alternative depending on future developments."
Last week, the billionaire investor Carl Icahn launched a proxy battle aimed at unseating the 10-member Yahoo board at its annual shareholder meeting in July. He claimed the board had acted "irrationally" and "irresponsibly" in rejecting a Microsoft offer at $33 per share, when Yahoo stock had been trading at just $19 before the bid.
Shares in Yahoo closed at $27.66 last week.