SEATTLE (AP) – The chief executives of Microsoft Corp. and Yahoo Inc. met recently to discuss possible business deals, news reports said Friday.

Under one possible scenario, Microsoft would sell Yahoo’s search ads while Yahoo would manage Microsoft’s display ads.

The meeting marks one of the most significant moves toward a new deal since Yahoo walked away from Microsoft’s unsolicited $47.5 billion buyout offer last year.

At the time, Microsoft hoped a combined company would be better at competing with Google Inc. for Web searches and the online advertising dollars they generate.

Jerry Yang, Yahoo’s founder and then-CEO, spurned Microsoft and sought an advertising partnership with Google. When antitrust concerns squelched that deal, he tried to revive the buyout talks, but Microsoft CEO Steve Ballmer had lost interest in owning all of the struggling Web pioneer.

Yang stepped down in November, and in January, Yahoo tapped Carol Bartz as its new chief. Ballmer said in March that he had only spoken with Bartz once since then, to congratulate her and tell her he’d like to talk at some point about a possible deal.

Neither company would comment on the meeting, which was described as preliminary and informal by The New York Times and The Wall Street Journal’s All Things Digital blog.


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