Yahoo and Microsoft Involved in Secret Talks on “Huge Deal”

Sources familiar with the matter claim the two companies have held talks on a new deal

Yahoo and Microsoft, the two technology giants that are already working together thanks to a search advertising deal, have held talks on a potential deal involving New York-based ad tech startup AppNexus.

Calling this potential partnership a “huge deal,” Business Insider reports that negotiations between the involved parties came to an end once Yahoo!’s board decided to replace CEO Ross Levinsohn with Marissa Mayer.

It appears that Yahoo! actually planned to take control of a large stake in AppNexus, in an attempt supposed to significantly improve its advertising business.

Microsoft, on the other hand, also owns approximately 30 percent of AppNexus, so the Redmond-based technology company had to be involved in these secret negotiations with Yahoo!. What’s more, Microsoft is currently the biggest client of the New York ad startup, and Yahoo! actually wanted to develop a project similar to Microsoft’s.

“Microsoft has a relationship with AppNexus. There have been periodic discussions with each of the Yahoo! executive teams about a similar arrangement with Yahoo!,” a source familiar with the matter told Business Insider.

“The folks who were running Yahoo! when Ross was in charge were favorably predisposed toward us. Had they continued to be the regime in charge there, there would have been a good possibility that we would have done some sort of deal together.”

Although the upper management shift that took place at Yahoo! earlier this year is considered the main reason why the involved parties failed to reach an agreement, it seems that some Yahoo! executives actually opposed to the deal because of the AppNexus CEO Brian O’Kelley.

O’Kelley was previously in charge of Right Media, another ad tech startup acquired by Yahoo! approximately two years before.

Microsoft is yet to comment on this subject, but we’ve contacted the company and we’ll update this story when we get an answer.

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