Microhoo's prenuptial: they CAN get out of it

Thu 6 August 2009 09:01, Bas van den Beld

The prenuptial agreement for the newly weds Yahoo and Microsoft is on the table and as it turns out Yahoo has got a pretty interesting escape route set up. If MS/Yahoo don't perform well enough against Google on the key metrics of revenue per search and U.S. market share, the deal can be terminated.

The Microsoft / Yahoo deal has turned into a soap opera. Every day there is a new development, on day one its 'Yes, I do', on day three they could be killing one another. This term sounds a lot like "get me pregnant or the marriage is off".

The terms are out into the open because Yahoo and Microsoft filed details of the deal to the SEC, the United States Securities and Exchange Commission, which looks at deals like this to see if it doesn't interfere with the market's rules.

In the filing it says: "Yahoo! may terminate the Search Agreement if the trailing 12-month average of the RPS in the United States (the “U.S. RPS”) of Yahoo! and Microsoft’s combined queries falls below a specified percentage of Google Inc.’s (“Google”) estimated RPS measured on a comparable basis or if the combined Yahoo! and Microsoft query market share in the United States falls below a specified percentage." The tricky part is that the "specified percentage" isn't specified here.

The filing (find it here) has got a lot of information in it and the term on which Yahoo can bail themselves out is just a small portion of it.

So the soap continues. Though this filing probably will turn out to be less exiting than one thinks now.

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