Britain's Daily Mail is in talks with potential partners to mount a joint bid for Yahoo's internet assets, eyeing a plan to buy the troubled U.S. Internet pioneer to help boost advertising revenues from the Mail's globally popular online news site.
The parent company of the British newspaper, the Daily Mail & General Trust, said on Monday that it was in early stage discussions with several parties about a possible bid for Yahoo, confirming a Wall Street Journal report it had approached private equity buyers to team up.
"We have been in discussions with a number of parties who are potential bidders," a spokeswoman for DailyMail.com said in an emailed statement, declining to name the private equity firms or give any financial details.
DailyMail.com and MailOnline are the celebrity-focused news websites of the right-leaning London-based Daily Mail newspaper. Globally the websites attract 14 million visitors a day, putting them among the world's most popular English language news sites.
Buying Yahoo's assets - which range from search and email to news, sports, photos and other properties - would expand DailyMail.com's reach and improve its digital ad revenues, which for its 2015 financial year came in at 73 million pounds ($104 million), a tenth of the company's overall annual turnover.
Liberum analyst Ian Whittaker said a deal with Yahoo would be positive for the company, helping it sell more U.S. advertising and reducing its dependence on shrinking advertising sales from its newspaper business in Britain.
"The U.S. has been the main driver of digital growth for Daily Mail & General Trust, whilst traffic has grown well they haven't quite monetised this traffic as successfully as they would have liked," Whittaker said.
That would follow a similar but smaller deal last year when it bought Elite Daily, a U.S. news and entertainment website in a deal which it said would make its offering to U.S.-based advertising buyers more attractive by widening its audience.
Daily Mail & General Trust PLC's potential bid could take one of two forms, according to the WSJ report, citing people familiar with the matter. In one scenario, a private-equity partner would acquire Yahoo's core web business, with the Mail taking over the news and media properties.
In the other scenario, the private-equity firm would acquire Yahoo's core web business and merge its media and news properties with the Mail's online operations. The merged units would form a new company that would be run by the Mail and give a larger equity stake to the Mail's parent company than under the first scenario, the report said.
Bids for Yahoo are due on April 18, in an auction that is likely to be hotly contested.
Time is also considering partnering with a private equity firm on a bid for Yahoo's core Internet assets, Reuters reported earlier this month while U.S. telecommunications giant Verizon, which owns AOL, another fallen Internet pioneer, is also eyeing a deal.