Microsoft and private equity firm Silver lake Partners have apparently been drafting plans to submit a bid to acquire Yahoo. However, there are also talks of a cross talk ban, which would require parties interested in buying Yahoo not to talk anyone else and submit joint-bids after they gain access to sensitive financial data at Yahoo.
The move seems to be designed to increase competition among bidders and drive the price for Yahoo up. However, it could also alienate potential buyers and at a market cap of $20.4 billion, Yahoo is a big piece to swallow. Microsoft remains as the only likely buyer that could swallow a company the size of Yahoo. Microsoft offered close to $45 billion for Yahoo, but could get away with far less this time, especially if there aren't many bidders left.
So far, the acquisition talks are based on rumors and speculation. Yahoo has not publicly confirmed that it is available to be acquired. According to Comscore, Yahoo has about 17.2 percent search market share in the U.S.. Google is ahead with 65.4 percent, Microsoft is behind with 13.4 percent.