Microsoft met with Yahoo to discuss the software maker's unsolicited takeover bid earlier this week, a breakthrough that could be the first step toward a friendly deal between the two rivals, an Associated Press report said.
The meeting occurred last week near Yahoo's Sunnyvale headquarters, according to a person familiar with the situation.
The person spoke Friday on the condition of not being identified because the preliminary talks haven't been formally disclosed.
The Associated Press report said no investments bankers attended the meeting, nor was there any discussion about whether Microsoft is willing to raise its offer, initially valued at $44.6 billion, or $31 per share.
Yahoo's board already has rejected that bid, arguing the company's internet franchise is worth more, the report said.
Although it's unclear whether Microsoft CEO Steve Ballmer and his Yahoo counterpart, Jerry Yang, attended the meeting, senior management from both companies were on hand, the Associated Press report also said.
The gathering, first reported by The Wall Street Journal, gave Microsoft its first chance to sell Yahoo on the rationale for the proposed marriage since the software maker unveiled its plans six weeks ago, the report said.
Since then, Yang has been exploring different ways to ward off Microsoft, the report further said.