• Bloomberg News, Friday, June 13, 2008 11:30 AM

Financial analysts are weighing in on the Microsoft-Yahoo-Google saga, following the announcement of terminated talks between Microsoft and Yahoo, and the confirmation of a Yahoo-Google search partnership. Bloomberg News says the outcome is good for both Microsoft and Google shareholders: Microsoft shareholders never really wanted to acquire Yahoo in the first place, while Google shareholders are seeing their company add a huge search partner, while pretty much solidifying their dominance in search advertising.

It's a whole different story for Yahoo shareholders, who this morning have seen the company's stock price fall to about $22 per share (Microsoft's offered $34 per share, or $47.5 billion, in May). Canaccord Adams's analyst Colin Gillis says the Google partnership "has the perception of damaged goods.'' It's certainly failed to boost the company's share price; as a result, Bloomberg suggests that Yahoo CEO Jerry Yang could become more vulnerable to a proxy fight against billionaire investor Carl Icahn.

''This just reaffirms the view that Yahoo, and particularly Jerry Yang and David Filo, blew it,'' said Mark May, an analyst at Needham & Co. in New York. ''It's hard to see how this management team is going to be able to extract or create value anywhere near 33 bucks a share anytime soon.''

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