(Recasts first paragraph to add second source)
CHICAGO May 15 Yahoo Inc (YHOO.O) and Google
Inc (GOOG.O) are continuing to talk about a search advertising
partnership, but an announcement was not imminent, two sources
familiar with the talks said on Thursday.
Talks have "not cooled" in recent days after Microsoft Corp
(MSFT.O) withdrew its offer for Yahoo, one of the sources
Although talks remain fluid, a deal could could come "as
early as next week," the second source said. Both sources spoke
on condition of anonymity.
The two Internet companies began discussing a partnership
in which Yahoo would carry advertising from Google alongside
its own search results after Microsoft made its unsolicited
offer for Yahoo, initially valued at $44.6 billion, more than
three months ago.
Yahoo searched out alternative tie-ups after rejecting
Microsoft's offer, and held talks with Time Warner Inc's
(TWX.N) AOL unit and News Corp NWSa.N, other sources have
On May 3, Microsoft walked away from a sweetened $47.5
billion offer for Yahoo and has shown no signs of renewed
interest in the company.
Billionaire investor Carl Icahn has amassed a Yahoo stake,
and on Thursday mounted a proxy campaign to unseat Yahoo's
Google executives have expressed some reservations about
the regulatory issues surrounding a partnership with Yahoo, one
of the sources said. But both companies remain in contact with
regulators and any deal would be structured to pass regulatory
scrutiny, the source said.
(Reporting by Anupreeta Das; Editing by Toni Reinhold)