Eπιφυλακτική η Merrill Lynch για τις τράπεζες
Την έλλειψη αισιοδοξίας για την πορεία των ευρωπαϊκών τραπεζών, από τη στιγμή που το θέμα της καταγραφής των απομειώσεων δεν έχει ολοκληρωθεί και πιθανότητα θα πάρει αρκετό χρόνο, τονίζει σε έκθεσή της η Merrill Lynch μειώνοντας έτσι τις τιμές στόχους για το σύνολο των τραπεζών που παρακολουθεί. Μεταξύ αυτών και οι τέσσερις μεγαλύτερες της ελληνικής αγοράς.
Ειδικότερα, όσον αφορά στην Alpha bank ο οίκος προχωρά στη μείωση της τιμής-στόχου στα 19 ευρώ από 22,1 ευρώ, για την EFG Eurobank [EFGr.AT] στα 13,6 ευρώ από 18,1 ευρώ, στην Εθνική στα 33 ευρώ από 41,2 ευρώ, και για την Τράπεζα Πειραιώς [BOPr.AT] στα 16,1 ευρώ από 20,1 ευρώ προηγουμένως. Παράλληλα συστήνει αγορά για την Εθνική, ουδέτερη στάση για την Alpha Bank [ACBr.AT] , ενώ σημειώνει υποαπόδοση για τη Eurobank και την Πειραιώς.
Για την Εθνική ο οίκος αναφέρει ότι η αντικειμενική τιμή που θέτει ως στόχο αντιστοιχεί σε 8,3 φορές τα προβλεπόμενα για το 2009 κέρδη - επίπεδο που αν και είναι χαμηλότερο του μέσου ιστορικού όρου θεωρείται κατάλληλο δεδομένων των ρίσκων που αφορούν κυρίως στην Τουρκία και στην περιοχή των Βαλκανίων.
Αξίζει να αναφέρουμε ότι η Εθνική τράπεζα περιλαμβάνεται και στη λίστα της UBS με τις κορυφαίες 40 μετοχικές επιλογές της από όλο τον κόσμο. Ο εν λόγω οίκος σημειώνει ότι η εκτίμηση για το P/E 2008 είναι στο 8,4, και για το 2009 στο 6,9. Η μερισματική απόδοση για το τρέχον έτος υπολογίζεται στο 4,8 και για το επόμενο έτος στο 5,8.
Επιστρέφοντας στην έκθεση της Merrill Lynch, ο οίκος σημειώνει για την Alpha Bank ότι η αντικειμενική τιμή την οποία έχει θέσει αντιστοιχεί σε 9 φορές τις προβλέψεις κερδών για το 2009 - επίπεδο το οποίο είναι χαμηλότερο του μέσου ευρωπαϊκού όρου που κινείται γύρω στο 11.
Σε ό,τι αφορά στη Eurobank, η Merrill Lynch εκτιμά ότι η τιμή αντιστοιχεί σε Ρ/Ε 7,3 με βάσει τα εκτιμώμενα κέρδη για το 2009 κέρδη, ενώ για την Πειραιώς η τιμή αντιστοιχεί σε πολλαπλασιαστή 7,5. Ο οίκος συνολικά για τις ελληνικές τράπεζες εντοπίζει τον προβληματισμό για την πορεία τους στην επέκτασή τους στη Βαλκανική αγορά αλλά και στη συμπίεση των περιθωρίων λόγω της σταδιακής μείωσης του spread στα επιτόκια.
NAFTEMPORIKI
Economy | Business | Social | Leaked | Opinions
Sunday, July 13, 2008
Retail Sales Probably Rose on Tax Rebates: U.S. Economy Preview
Retail Sales Probably Rose on Tax Rebates: U.S. Economy Preview
July 13 (Bloomberg) -- Sales at U.S. retailers probably increased in June as Americans spent tax-rebate checks and record gasoline prices boosted receipts at service stations, economists said before reports this week.
Purchases rose 0.4 percent after a 1 percent gain the prior month, according to the median estimate in a Bloomberg News survey ahead of a Commerce Department report on July 15. Rising fuel and food costs also pushed up a cost-of-living index and a wholesale price gauge in June, other figures may show.
Consumers used the extra cash from the government's stimulus plan to buy discounted groceries and gasoline, lifting sales at stores including Wal-Mart Stores Inc. and Costco Wholesale Corp. The gains may dissipate after the checks are spent and households have to face plunging home values, less credit and costlier fuel.
``The stimulus checks are providing a fairly potent environment for retail sales,'' said Joseph Brusuelas, chief economist at Merk Investments LLC in Palo Alto, California. ``That is masking the real condition of the consumer, who is flat on his or her back. Once the impact of the stimulus fades, we're going to have a massive payback.''
Retail sales excluding automobiles probably rose 0.9 percent last month, the median forecast in the Bloomberg survey shows. The figure will include more spending at gasoline service-stations.
Regular unleaded fuel prices topped $4 a gallon in June and touched a record $4.11 last week, according to AAA.
Inflation Signs
Rising energy costs raise the risk of a broader pickup in inflation. The consumer price index rose 0.7 percent in June, the most since November, according to the Bloomberg survey median. Excluding food and energy, prices likely rose 0.2 percent for a second month. The Labor Department's report is due on July 16.
On July 15, another report from Labor may show prices paid to producers climbed for a sixth month in June, reflecting surging fuel and food expenses.
The threat of accelerating inflation is one reason Federal Reserve policy makers may forgo raising interest rates this year, even as the economy looks likely to stall following the temporary boost from the stimulus plan.
Economic growth will slow to a 0.5 percent annual rate in the fourth quarter, the weakest pace in six years, according to the median forecast in a monthly Bloomberg survey. Fourth- quarter consumer spending will post the smallest gain since 1991, the survey showed.
Consumers are holding back on big-ticket purchases such as automobiles. Cars and light trucks sold at a 13.6 million annual pace last month, the fewest since 1998, industry data showed.
Rebate Checks
The government had distributed $86.1 billion in rebate checks through July 4, out of a total plan of about $110 billion. Rebate-linked promotions helped sales at stores open at least a year to rise a better-than-forecast 4.3 percent in June, according to the International Council of Shopping Centers.
Wal-Mart's same-store sales jumped 5.8 percent in June, the biggest gain in four years. The Bentonville, Arkansas-based company's U.S. discount stores and Sam's Club membership warehouses drew additional consumers who spent more on the average visit in June than in prior months.
``We continue to see a shift in the overall mix toward fuel, food and consumables, as our members manage through the current environment,'' Doug McMillon, Sam's Club president and chief executive officer, said in a statement on July 10.
Two reports will reflect the prolonged housing slump. Commerce Department figures to be released July 17 may show that builders broke ground in June on the fewest homes in 17 years, according to the Bloomberg survey. The National Association of Home Builders/Wells Fargo sentiment index, scheduled for release July 16, may show builder confidence was at a record low for the second month in July, according to the survey median.
BLOOMBERG
July 13 (Bloomberg) -- Sales at U.S. retailers probably increased in June as Americans spent tax-rebate checks and record gasoline prices boosted receipts at service stations, economists said before reports this week.
Purchases rose 0.4 percent after a 1 percent gain the prior month, according to the median estimate in a Bloomberg News survey ahead of a Commerce Department report on July 15. Rising fuel and food costs also pushed up a cost-of-living index and a wholesale price gauge in June, other figures may show.
Consumers used the extra cash from the government's stimulus plan to buy discounted groceries and gasoline, lifting sales at stores including Wal-Mart Stores Inc. and Costco Wholesale Corp. The gains may dissipate after the checks are spent and households have to face plunging home values, less credit and costlier fuel.
``The stimulus checks are providing a fairly potent environment for retail sales,'' said Joseph Brusuelas, chief economist at Merk Investments LLC in Palo Alto, California. ``That is masking the real condition of the consumer, who is flat on his or her back. Once the impact of the stimulus fades, we're going to have a massive payback.''
Retail sales excluding automobiles probably rose 0.9 percent last month, the median forecast in the Bloomberg survey shows. The figure will include more spending at gasoline service-stations.
Regular unleaded fuel prices topped $4 a gallon in June and touched a record $4.11 last week, according to AAA.
Inflation Signs
Rising energy costs raise the risk of a broader pickup in inflation. The consumer price index rose 0.7 percent in June, the most since November, according to the Bloomberg survey median. Excluding food and energy, prices likely rose 0.2 percent for a second month. The Labor Department's report is due on July 16.
On July 15, another report from Labor may show prices paid to producers climbed for a sixth month in June, reflecting surging fuel and food expenses.
The threat of accelerating inflation is one reason Federal Reserve policy makers may forgo raising interest rates this year, even as the economy looks likely to stall following the temporary boost from the stimulus plan.
Economic growth will slow to a 0.5 percent annual rate in the fourth quarter, the weakest pace in six years, according to the median forecast in a monthly Bloomberg survey. Fourth- quarter consumer spending will post the smallest gain since 1991, the survey showed.
Consumers are holding back on big-ticket purchases such as automobiles. Cars and light trucks sold at a 13.6 million annual pace last month, the fewest since 1998, industry data showed.
Rebate Checks
The government had distributed $86.1 billion in rebate checks through July 4, out of a total plan of about $110 billion. Rebate-linked promotions helped sales at stores open at least a year to rise a better-than-forecast 4.3 percent in June, according to the International Council of Shopping Centers.
Wal-Mart's same-store sales jumped 5.8 percent in June, the biggest gain in four years. The Bentonville, Arkansas-based company's U.S. discount stores and Sam's Club membership warehouses drew additional consumers who spent more on the average visit in June than in prior months.
``We continue to see a shift in the overall mix toward fuel, food and consumables, as our members manage through the current environment,'' Doug McMillon, Sam's Club president and chief executive officer, said in a statement on July 10.
Two reports will reflect the prolonged housing slump. Commerce Department figures to be released July 17 may show that builders broke ground in June on the fewest homes in 17 years, according to the Bloomberg survey. The National Association of Home Builders/Wells Fargo sentiment index, scheduled for release July 16, may show builder confidence was at a record low for the second month in July, according to the survey median.
BLOOMBERG
AT&T's IPhone Stock Is Mostly Sold; Apple Has Supply
AT&T's IPhone Stock Is Mostly Sold; Apple Has Supply
July 13 (Bloomberg) -- AT&T Inc. stores have mostly emptied out of inventory of Apple Inc.'s new iPhone in the U.S. two days after thousands lined up to buy the handset.
Apple, seeking to widen its business beyond iPod media players and Macintosh computers, said it still had iPhone models in most of its own shops to sell today. The Cupertino, California-based company, which has 187 stores in 38 states, is selling it for as little as $199.
The iPhone 3G, which works with speedier third-generation phone networks, went on sale July 11 in the U.S. and 21 other countries. Apple's partners in the U.K., Germany, Canada and Japan said many shops ran out on the first day. AT&T, Apple's exclusive U.S. partner, said most of its 2,000 stores were out of supplies and that it expected new inventory within days.
``The Apple retail store likely has your iPhone 3G in stock,'' Apple told visitors on its Web site. ``Shipments of iPhone 3G arrive most days.''
Apple was out of all three models in 55 stores, according to a tally posted on its Web site last night. That includes outlets in Fresno, California; Victor, New York; Cherry Hill, New Jersey; Madison, Wisconsin; and Knoxville, Tennessee. Apple's lone stores in Indiana, Iowa, Nebraska, New Mexico and Rhode Island were out of supplies, leaving buyers there with no iPhones to buy today.
Shoppers seem to prefer the black, 16-gigabyte model, which sells for $299, based on Apple's tally. The company is also selling a 16-gigabyte model in white. The 8-gigabyte handset, priced at $199, is only available in black, according to Apple's site. Customers must sign up for a two-year contract with AT&T at the time of purchase.
New York Supply
The New York store on Fifth Avenue, the only shop that is open 24 hours a day, seven days a week, said it will have the Web-surfing handset available. So will Apple's other New York City stores in SoHo and on West 14th Street.
Customers shopping at the Fifth Avenue store between 3 a.m. and 7 a.m. were unable to buy the phone. AT&T says it routinely does maintenance on its computers during that time, preventing users from signing up for service. The company is ``working on a solution to enable sales to still occur during this window,'' said AT&T spokesman Michael Coe. ``We apologize for any inconvenience this may have caused for our customers.''
Apple said it will update its retail availability list each evening at 9 p.m. San Francisco time.
Waiting in Line
AT&T and online Apple fan sites said on the first day that some customers left stores without a working phone because of problems linking the device to Apple's iTunes service, the last step in the activation process. AT&T told buyers to link to iTunes from home. Apple spokesman Steve Dowling declined to comment.
At the SoHo store, manager Khalil Smith said there weren't any problems with activation yesterday morning. ``Things have been going really smoothly, and people are really happy,'' he said.
Lines snaked around the block in New York, with about 50 customers taking their places by 7:30 a.m. yesterday, said Matthew Gurgel.
``Every half-hour we move a little bit,'' said Magda Buccek, 21, of Brooklyn, who said she had thought the line would move more quickly.
Regine Klosebriganti of New York, 24, went to the Fifth Avenue Apple store at 1 a.m. and was told the line was closed. ``It was a mob scene,'' she said. ``They said I could come back at 3 a.m. This is nothing compared to what they had there.''
``If you're selling a product of convenience, why do you put your customers through inconvenience?'' said Chad Stoller, 37, who left the line at the SoHo store, saying it wasn't worth the wait. He said he had expected the line to be much shorter, anticipating that activation issues from the first day would deter people from buying the iPhone 3G.
Apple fell $4.05 to $172.58 July 11 in Nasdaq Stock Market trading. Dallas-based AT&T dropped 19 cents to $32.58.
BLOOMBERG
July 13 (Bloomberg) -- AT&T Inc. stores have mostly emptied out of inventory of Apple Inc.'s new iPhone in the U.S. two days after thousands lined up to buy the handset.
Apple, seeking to widen its business beyond iPod media players and Macintosh computers, said it still had iPhone models in most of its own shops to sell today. The Cupertino, California-based company, which has 187 stores in 38 states, is selling it for as little as $199.
The iPhone 3G, which works with speedier third-generation phone networks, went on sale July 11 in the U.S. and 21 other countries. Apple's partners in the U.K., Germany, Canada and Japan said many shops ran out on the first day. AT&T, Apple's exclusive U.S. partner, said most of its 2,000 stores were out of supplies and that it expected new inventory within days.
``The Apple retail store likely has your iPhone 3G in stock,'' Apple told visitors on its Web site. ``Shipments of iPhone 3G arrive most days.''
Apple was out of all three models in 55 stores, according to a tally posted on its Web site last night. That includes outlets in Fresno, California; Victor, New York; Cherry Hill, New Jersey; Madison, Wisconsin; and Knoxville, Tennessee. Apple's lone stores in Indiana, Iowa, Nebraska, New Mexico and Rhode Island were out of supplies, leaving buyers there with no iPhones to buy today.
Shoppers seem to prefer the black, 16-gigabyte model, which sells for $299, based on Apple's tally. The company is also selling a 16-gigabyte model in white. The 8-gigabyte handset, priced at $199, is only available in black, according to Apple's site. Customers must sign up for a two-year contract with AT&T at the time of purchase.
New York Supply
The New York store on Fifth Avenue, the only shop that is open 24 hours a day, seven days a week, said it will have the Web-surfing handset available. So will Apple's other New York City stores in SoHo and on West 14th Street.
Customers shopping at the Fifth Avenue store between 3 a.m. and 7 a.m. were unable to buy the phone. AT&T says it routinely does maintenance on its computers during that time, preventing users from signing up for service. The company is ``working on a solution to enable sales to still occur during this window,'' said AT&T spokesman Michael Coe. ``We apologize for any inconvenience this may have caused for our customers.''
Apple said it will update its retail availability list each evening at 9 p.m. San Francisco time.
Waiting in Line
AT&T and online Apple fan sites said on the first day that some customers left stores without a working phone because of problems linking the device to Apple's iTunes service, the last step in the activation process. AT&T told buyers to link to iTunes from home. Apple spokesman Steve Dowling declined to comment.
At the SoHo store, manager Khalil Smith said there weren't any problems with activation yesterday morning. ``Things have been going really smoothly, and people are really happy,'' he said.
Lines snaked around the block in New York, with about 50 customers taking their places by 7:30 a.m. yesterday, said Matthew Gurgel.
``Every half-hour we move a little bit,'' said Magda Buccek, 21, of Brooklyn, who said she had thought the line would move more quickly.
Regine Klosebriganti of New York, 24, went to the Fifth Avenue Apple store at 1 a.m. and was told the line was closed. ``It was a mob scene,'' she said. ``They said I could come back at 3 a.m. This is nothing compared to what they had there.''
``If you're selling a product of convenience, why do you put your customers through inconvenience?'' said Chad Stoller, 37, who left the line at the SoHo store, saying it wasn't worth the wait. He said he had expected the line to be much shorter, anticipating that activation issues from the first day would deter people from buying the iPhone 3G.
Apple fell $4.05 to $172.58 July 11 in Nasdaq Stock Market trading. Dallas-based AT&T dropped 19 cents to $32.58.
BLOOMBERG
Yahoo Rejects Microsoft, Icahn Bid to Split Company
Yahoo Rejects Microsoft, Icahn Bid to Split Company
July 13 (Bloomberg) -- Yahoo! Inc. rejected a proposal from Microsoft Corp. and billionaire investor Carl Icahn that would have broken up the Internet company, saying they were trying to ``coerce'' officials into selling assets.
Under the plan, Yahoo's current board and top management would be replaced. Microsoft would buy Yahoo's search business and leave Icahn with the rest of the Sunnyvale, California-based company, an ``odd and opportunistic alliance'' that doesn't have the best interests of shareholders in mind, Yahoo said.
``Carl Icahn and Microsoft presented us with a `take it or leave it' proposal,'' Chairman Roy Bostock said in a statement. ``It is ludicrous to think that our board could accept such a proposal. We will not be bludgeoned into a transaction that is not in the best interests of our stockholders.''
The decision steps up pressure on Yahoo Chief Executive Officer Jerry Yang to prove his alternative deal, a partnership with Google Inc., can deliver better returns. Icahn has proposed a set of directors and is challenging Yang for control of the board at an Aug. 1 meeting.
Yahoo, owner of the No. 2 Web search engine after Google, said it was given 24 hours to weigh the latest proposal, made Friday evening. Some of the ideas, including spinning off the Asian investment assets and returning cash to shareholders, are items the board is already considering.
No Negotiating
Yahoo ``has shown no flexibility in separating the search engine from the rest of the company,'' Andrew Frank, an analyst at industry researcher Gartner Inc. in New York, said today in an interview. ``Microsoft is sincere in that it wants to make a deal and Yahoo sincerely thinks it is undervalued.''
Microsoft and Icahn didn't want to negotiate, Yahoo said. Directors again offered to sell the entire company for at least $33 a share, the last price the software maker put out in the six months of on-and-off talks. An outright acquisition would be much more ``straightforward,'' Yahoo said. A deal for the whole company could be negotiated before Aug. 1, Yahoo said.
Icahn didn't return a call to his home. Microsoft spokesman Frank Shaw declined to comment. The software maker said July 7 it has concluded officials cannot reach any agreement with Yahoo's current board.
Since Microsoft made its original offer of $44.6 billion public Feb. 1, CEO Steve Ballmer tried several proposals to woo Yahoo to expand its Internet-search business and compete with Google in the $41 billion worldwide online advertising market.
Yahoo repeatedly rebuffed the bids, demanding more money. When Ballmer switched to offers for just the search unit, they also were rejected.
Less Complexity
Yahoo, which closed at $23.57 July 11, has dropped 10 percent since June 11, the day before Microsoft said it would end attempts at a transaction. Microsoft fell 20 cents to $25.25 July 11 in Nasdaq Stock Market trading.
Founded more than a decade ago by Yang and David Filo, Yahoo reported eight straight quarters of profit declines before Redmond, Washington-based Microsoft's bid and is now relying on its biggest rival for growth.
Yahoo agreed last month to let Google sell some of the advertisements it runs alongside Internet search results. The agreement has ``superior financial value and less complexity and risk than the Microsoft/Icahn proposal,'' Yahoo said.
The deal would generate as much as $450 million in cash flow in the 12 months after it starts, Yahoo said, because Google generates more money from each search.
Tricky Separation
Microsoft and Icahn also sweetened the offer for Yahoo's search business, Yahoo said, without getting into specifics. Microsoft had offered to buy $8 billion in Yahoo shares for $35 each and the search business for an additional $1 billion.
The two companies also would have struck a long-term search engine partnership guaranteeing Yahoo higher revenue for three years than what it gets from its own ad system.
Still, even with higher guarantees for Yahoo, separating the search business from the unit that sells ``display'' banner advertising and video spots would be tricky, the company said.
There is also risk with the Google arrangement. Federal regulators are expected to begin hearings this week on whether the ad accord between the two dominant Internet search companies is anti-competitive, Google CEO Eric Schmidt said July 10.
Yahoo handled about 20.6 percent of U.S. Internet searches in May, more than twice Microsoft's search traffic, according to researcher ComScore Inc. Google, based in Mountain View, California, accounted for almost two-thirds.
Icahn is seeking to build momentum ahead of the Yahoo shareholder meeting next month, aiming to replace Yahoo's board with nine nominees including himself. Icahn has already won backing from holders including T. Boone Pickens, chairman of BP Capital LLC, and hedge-fund manager John Paulson.
``It's hard to gauge the loyalty of the shareholders at large to the board and their frustration that Yahoo has not availed itself of any offers,'' Gartner's Frank said. ``The next step will be the August board meeting, and we'll have to wait to see what kind of theatrics go on.''
BLOOMBERG
July 13 (Bloomberg) -- Yahoo! Inc. rejected a proposal from Microsoft Corp. and billionaire investor Carl Icahn that would have broken up the Internet company, saying they were trying to ``coerce'' officials into selling assets.
Under the plan, Yahoo's current board and top management would be replaced. Microsoft would buy Yahoo's search business and leave Icahn with the rest of the Sunnyvale, California-based company, an ``odd and opportunistic alliance'' that doesn't have the best interests of shareholders in mind, Yahoo said.
``Carl Icahn and Microsoft presented us with a `take it or leave it' proposal,'' Chairman Roy Bostock said in a statement. ``It is ludicrous to think that our board could accept such a proposal. We will not be bludgeoned into a transaction that is not in the best interests of our stockholders.''
The decision steps up pressure on Yahoo Chief Executive Officer Jerry Yang to prove his alternative deal, a partnership with Google Inc., can deliver better returns. Icahn has proposed a set of directors and is challenging Yang for control of the board at an Aug. 1 meeting.
Yahoo, owner of the No. 2 Web search engine after Google, said it was given 24 hours to weigh the latest proposal, made Friday evening. Some of the ideas, including spinning off the Asian investment assets and returning cash to shareholders, are items the board is already considering.
No Negotiating
Yahoo ``has shown no flexibility in separating the search engine from the rest of the company,'' Andrew Frank, an analyst at industry researcher Gartner Inc. in New York, said today in an interview. ``Microsoft is sincere in that it wants to make a deal and Yahoo sincerely thinks it is undervalued.''
Microsoft and Icahn didn't want to negotiate, Yahoo said. Directors again offered to sell the entire company for at least $33 a share, the last price the software maker put out in the six months of on-and-off talks. An outright acquisition would be much more ``straightforward,'' Yahoo said. A deal for the whole company could be negotiated before Aug. 1, Yahoo said.
Icahn didn't return a call to his home. Microsoft spokesman Frank Shaw declined to comment. The software maker said July 7 it has concluded officials cannot reach any agreement with Yahoo's current board.
Since Microsoft made its original offer of $44.6 billion public Feb. 1, CEO Steve Ballmer tried several proposals to woo Yahoo to expand its Internet-search business and compete with Google in the $41 billion worldwide online advertising market.
Yahoo repeatedly rebuffed the bids, demanding more money. When Ballmer switched to offers for just the search unit, they also were rejected.
Less Complexity
Yahoo, which closed at $23.57 July 11, has dropped 10 percent since June 11, the day before Microsoft said it would end attempts at a transaction. Microsoft fell 20 cents to $25.25 July 11 in Nasdaq Stock Market trading.
Founded more than a decade ago by Yang and David Filo, Yahoo reported eight straight quarters of profit declines before Redmond, Washington-based Microsoft's bid and is now relying on its biggest rival for growth.
Yahoo agreed last month to let Google sell some of the advertisements it runs alongside Internet search results. The agreement has ``superior financial value and less complexity and risk than the Microsoft/Icahn proposal,'' Yahoo said.
The deal would generate as much as $450 million in cash flow in the 12 months after it starts, Yahoo said, because Google generates more money from each search.
Tricky Separation
Microsoft and Icahn also sweetened the offer for Yahoo's search business, Yahoo said, without getting into specifics. Microsoft had offered to buy $8 billion in Yahoo shares for $35 each and the search business for an additional $1 billion.
The two companies also would have struck a long-term search engine partnership guaranteeing Yahoo higher revenue for three years than what it gets from its own ad system.
Still, even with higher guarantees for Yahoo, separating the search business from the unit that sells ``display'' banner advertising and video spots would be tricky, the company said.
There is also risk with the Google arrangement. Federal regulators are expected to begin hearings this week on whether the ad accord between the two dominant Internet search companies is anti-competitive, Google CEO Eric Schmidt said July 10.
Yahoo handled about 20.6 percent of U.S. Internet searches in May, more than twice Microsoft's search traffic, according to researcher ComScore Inc. Google, based in Mountain View, California, accounted for almost two-thirds.
Icahn is seeking to build momentum ahead of the Yahoo shareholder meeting next month, aiming to replace Yahoo's board with nine nominees including himself. Icahn has already won backing from holders including T. Boone Pickens, chairman of BP Capital LLC, and hedge-fund manager John Paulson.
``It's hard to gauge the loyalty of the shareholders at large to the board and their frustration that Yahoo has not availed itself of any offers,'' Gartner's Frank said. ``The next step will be the August board meeting, and we'll have to wait to see what kind of theatrics go on.''
BLOOMBERG
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