Yahoo denies Microsoft search deal

Yahoo has no plans to sell its internet search business to a Microsoft-backed investment consortium, despite news reports to the contrary which surfaced over the weekend.

The Sunday times had reported that Microsoft was to spend $5 billion to back a management team to take control of Yahoo, which was to be led by former AOL CEO Jonathan Miller and former Fox Interactive president Ross Levinsohn.

Under the reported arrangement, Microsoft would have the option to buy Yahoo's search business for $20 billion, an option that would be left open for two years.

But Miller has told the Wall Street Journal blog AllThingsDigital that the report was "total fiction".

And insider sources have told Bloomberg that Yahoo has no plans to sell its business to the consortium. 

Separately, market analysts have told Bloomberg that Yahoo may have trouble finding a replacement CEO now that current chief Jerry Yang has agreed to step down over his February decision to refuse Microsoft's $44.5 billion takeover bid.

For instance, Cowen & Co Analyst James Friedland said the next CEO will have to prepare Yahoo for a take-over, which will require finding somebody with a very different management style than Yang's.

Analysts have also been speculating as to who may take the top job, with Jonathan Miller and News Corp president Peter Cherenin considered the most likely candidates.

A Yahoo spokesperson has said the company's president, Susan Decker, is also in the running.