A bit of friendly competition, then?
Telecom giant AT&T is reportedly going head-to-head with rival Verizon to acquire the core assets of failing Internet company Yahoo.
According to Bloomberg, AT&T has submitted a bid for Yahoo’s core Internet business and remains in the running to win. The news represents a turnaround from reports in April that indicated AT&T had decided not to bid in the proceedings.
The move is also surprising given AT&T’s recent decision to end its 15-year partnership with Yahoo and transition its web hosting services to Buffalo, N.Y.-based company Synacor, Inc.
While it didn’t make an initial offer, Bloomberg said AT&T was able to remain involved in the bidding process thought its stake in YP Holdings. YP was previously looking to merge with a spin-off of Yahoo’s core business, but has since dropped that proposal, Bloomberg sources said.
AT&T’s participation puts it up against fellow telecom operator Verizon, which is reportedly favored as the frontrunner in the bid proceedings. According to the Wall Street Journal, AT&T’s offer is also reportedly up against bids from equity firms TPG, Bain Capital LP and Vista Equity Partners and former Yahoo CEO Ross Levinsohn.
Though Verizon is still the top pick to buy Yahoo, Bloomberg sources said the company did not put in one of the highest first-round bids.
Offers in the first round of bidding ranged between $4 billion to $8 billion, but the Wall Street Journal last week reported bids the second go around are expected to be substantially lower.
Sources cited by the Journal expect suitors to bid between $2 billion and $3 billion for the assets in the second round, though CNBC sources subsequently said the information in the Wall Street Journal was “completely wrong.”
Second round bidding is currently underway with a deadline in the first week of June.