The second round of bids for Yahoo! Inc.YHOO matched analyst expectations as the company received multiple offers worth $5 billion or above, according to a CNBC report on Thursday.
Per earlier reports, analysts had expected Yahoo to be worth somewhere between $4 billion and $10 billion.
Some of the bids include the company's patent portfolio and real estate while others are for the core business alone.
Verizon Communications Inc. VZ was initially thought to be in the lead, but per CNBC's report, Verizon's bid of a little above $3.5 billion is one of the lowest during the round.
This is justified to some extent if we consider Verizon's disinterest in Yahoo's non-core assets such as patents and real estate.
YAHOO! INC Price
Surprisingly, a bidder's group led by Quicken Loans Inc. founder Dan Gilbert, and backed by Berkshire Hathaway Inc. Chairman Warren Buffett took part in the process. The final round may as well see the entry of additional bidders.
Bidders who are already in the fray include AT&T, Inc. T , TPG Capital LP and a consortium of Bain Capital Private Equity and Vista Equity Partners Management LLC.
Many analysts believe that AT&T will be head-to-head with Verizon in the final round. We may also see other companies like Microsoft Corporation MSFT , Google, Comcast and Fox joining the race.
New entrants and likely higher bids might increase pressure on Verizon to increase its offer in the final round and include Yahoo's patents and real estate in its bid.
If the second round of bids is anything to go by, then don't be surprised to see Yahoo refusing to consider offers below $5 billion in the final round.
Yahoo is expected to hold a board meeting soon to shortlist the best bids for the final round that could start as early as next week and conclude sometime in mid -July.
Currently, Yahoo is a Zacks Rank #3 (Hold) stock.
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