Cramer came out tonight on CNBC’s MAD MONEY proposing that Yahoo! (YHOO) and eBay (EBAY) should get together and merge. He is calling for this because the growth is slowing in both areas and that would jumpstart it. Cramer contends that companies with slower growth have to do something to get their sizzle back. Cramer said that Microsoft (MSFT) was reportedly in talks to buy Yahoo!, but the aQuantive (AQNT) buyout signals it is willing to do deals. If these companies had better areas to invest in they wouldn’t be propping shares up with buybacks. This would allow Yahoo!’s massive users to use Skype and PayPal to buy goods. Cramer thinks this would bring back growth, and would finally get Semel out of Yahoo!
As Cramer is long Yahoo! (YHOO) in his charitable trust and as he’s been touting ideas for something like this, this ‘call to merge’ is hardly a surprise to me or to others. The market caps are very similar, although eBay is the larger company.
Jon C. Ogg
May 30, 2007
Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.
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