Yahoo CEO says instinct to keep search business-DJ

Jan 15 (Reuters) - Yahoo Inc's YHOO.O new chief executive, Carol Bartz, told employees on Wednesday her gut instinct is to hang on to the company's search business, the Dow Jones newswire reported.

But Bartz also told staff she needs to better understand the pros and cons involved in selling the business, and that she had spoken with Microsoft Corp MSFT.O CEO Steve Ballmer in the past 24 hours, the newswire quoted a Yahoo source as saying.

Yahoo could not be immediately reached by Reuters for comment.

Bartz’s appointment, which was confirmed on Tuesday, paves the way for the Internet company to finally make decisions on its big issues, including a sale or search deal with Microsoft, several analysts said on Wednesday.

Under previous CEO and co-founder Jerry Yang, Yahoo rejected a $47.5 billion buyout offer from Microsoft nearly a year ago. Yang, who then saw an alternative Web search advertising partnership with Google Inc GOOG.O fall apart under U.S. antitrust scrutiny, agreed to step down in November.

Bartz, the former head of Autodesk Inc ADSK.O, provided no details of her conversation with Ballmer, Dow Jones reported.

Reporting by Ratul Ray Chaudhuri in Bangalore; editing by John Stonestreet