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Yahoo Rethinking Sales Strategy

Yahoo is trying a different approach to its sale.

Until recently, Yahoo was actively seeking out a buyer, but now that plan may be taking a back seat to a new strategy - private investment in public equity (PIPE), which involves selling a large amount of stock to private equity firms, The New York Times reports.

As the source explains,

Until recently, Yahoo was actively seeking out a buyer, but now that plan may be taking a back seat to a new strategy - private investment in public equity (PIPE), which involves selling a large amount of stock to private equity firms, The New York Times reports.

As the source explains, that sale structure usually involves a firm or hedge fund buying just under one-fifth of the company at a discounted rate. Yet the move is unusual because Yahoo is not struggling financially, and PIPE transactions are typically used by small or cash-strapped organizations.

The Times say some of the reasons Yahoo may be going with PIPE include a desire to block actions from some shareholders by giving more power to investors that are "friendly," or an attempt to create a leveraged recapitalization that would give the additional private equity firms a bigger portion of ownership.

Even as Yahoo prepares to sell itself, it is also acquiring additional companies. On Tuesday, the internet business launched a cash tender offer through a wholly owned subsidiary to buy outstanding shares of interCLICK Inc. common stock.  

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