Murdoch says News Corp, Yahoo tie-up very unlikely

SUN VALLEY, IDAHO Fri Jul 11, 2008 3:02am EDT

SUN VALLEY, IDAHO (Reuters) - News Corp's Rupert Murdoch said it was "very unlikely" his company would be involved in any Yahoo Inc. transaction and said Yahoo and Microsoft would not end up with any deal.

Asked whether he thought Yahoo would end up in Microsoft Corp's hands, he said, "There won't be a deal. There's bad personal feelings."

Microsoft offered to buy Yahoo earlier this year for $47.5 billion, but withdrew its offer in May after feeling frustrated over discussions.

"In six months, (Microsoft) will walk away," Murdoch said at the annual Allen & Co media and technology moguls confab.

News Corp has reportedly been on the sidelines of recent discussions involving Yahoo.

Shortly after Microsoft offered to take over Yahoo, News Corp held talks with Yahoo to combine its popular MySpace Internet social network with Yahoo and separately discussed a possible deal with Microsoft to take over Yahoo.

Murdoch said one of Yahoo's biggest investors Capital Research, whose portfolio manager and legendary media insider Gordon Crawford publicly chastised Yahoo for failing to secure a Microsoft deal, would have gladly settled for a buyout at $33 per share.

"He's pissed he didn't get $33," Murdoch said of Crawford.

Would Crawford have backed a deal to sell Yahoo for $33 a share?

"He would have taken it in a flash," Murdoch said of the price that Microsoft last offered before it walked away from talks with Yahoo.

(Editing by Will Waterman and Sue Thomas)