AOL And Yahoo To Merge?

After the Yahoo rejected a $47.5 billion dollar offer to merge with Microsoft, Yahoo is on the merging scene again. Bloomberg reports that AOL’s Chief Executive Officer, Tim Armstrong, is in talks with Yahoo advisers to combine the two companies into one.

This is just after Yahoo’s Chairman of the Board, Roy Bostock, fired their CEO Carol Bartz. On Tuesday September 6, 2011, Carol Bratz had sent an email to her employees containing only two sentences saying that she has received a call from Yahoo’s Chairman saying that she was fired during a phone call.

Currently, AOL’s CEO Tim Armstrong is discussing the options for the combining of the two companies aimed at strengthening the two companies. Armstrong was previously interested in the idea in the merger last year. The removal of Carol Blitz has caused Tim to reconsider the option, under the current scenario now being considered. He has talked with private equity firms and investment bankers from Allen & Co who is working with Yahoo. An unidentified person who is familiar with the matter has said that if the merger was to happen, Armstrong would become CEO of both AOL and Yahoo.

As of right now, the unidentified person who is familiar with the matter has said that Yahoo is unlikely to be interested in the AOL merger. The person said that Yahoo is not interested with the merger due to the company’s losses and declining revenue. As of right now, AOL’s current market value is around $1.6 billion, while Yahoo’s is around $18.2 billion.