Yahoo Weighs Sale Of Internet Biz, Should Apple Make A Move To Buy It All?

Say it isn't so. First AOL was taken out and driven to oblivion by Time Warner and now it looks like Yahoo is considering selling its core business.

At least that's what the chatter is today. The Board of Directors at Yahoo are going to be in meetings over the next few days to decide on whether a sale of everything at Yahoo (except its Alibaba stake, aka Aabaco) would make the most sense from a shareholder perspective.

One of the major reasons for Yahoo's board looking at alternatives to an Aabaco/Alibaba stake spin-off is the uncertainty around the tax situation with the IRS recently declining to rule on the tax consequences.

I cut my internet teeth on AOL  back in 1991 (grad school) and then Yahoo (mid-nineties) which became the go-to site for all sorts of information from all over the world.

Bob Peck, the internet analyst at SunTrust lists the following companies as potential buyers for Yahoo's core internet business:  Comcast , AT&T/DirecTv, Verizon/AOL, Disney, Newscorp and the larger P/E firms.

Other names mentioned as potential acquirers are China's Alibaba and Japan's Softbank both of which have existing business/partnership ties with Yahoo. I might add that Yahoo has very close ties with both these Asian companies.

According to Peck, the Yahoo board may also consider the following options:

• Sell the core business outright;
• Spin-off the core business;
• Sell the entire company, Alibaba and core business all included
• Sell the Asian assets (SoftBank Japan and Alibaba stake);
• Wait for clarity from the IRS;
• Sit tight and do nothing.

Peck estimates that the core business of Yahoo could bring in $6-$8 billion.

My wild idea?  I think Apple should take out the entire company, core and Alibaba stake and the kitchen sink as well thrown in for good measure.

Think about it.  With the Alibaba stake, Apple could enter the Middle Kingdom in an even bigger way for all its various ecosystem initiatives not to mention all of its hardware. Who better to partner with in China than Alibaba which has the Chinese government as its godfather.

Just imagine the possibilities for both Alibaba and Apple.

Again, the legalities of the entire deal between the three companies would be complicated but thats why Silicon Valley lawyers are the best paid lawyers in the world.

If a deal like this doesn't get Apple shareholders excited and the stock out of the deep coma it has been for all of 2015, I don't see what will.

The Apple and Alibaba partnership/J.V. could be called Appbaba.

May the trade always be in your favor.

(Long Apple and Yahoo shares, long and short Apple calls)