Could Time Warner Come to Yahoo’s Rescue?

Yahoo, which rejected Microsoft’s bid to acquire the firm, may be looking east for its future.

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Quoting unnamed sources, WSJ.com reports today Yahoo is in talks with TIme Warner, based in New York City, over developing an alternative to Microsoft’s unsolicited offer for Yahoo. Specifically, the report says, discussion is centered on folding Time Wartner’s AOL into Yahoo and giving Time Warner a minority stake in the combined organization.

Yahoo rejected Microsoft’s bid, complaining that it undervalued the Silicon Valley company.

Earlier speculation had focused on the possibility of News Corp. making an offer for Yahoo. WSJ.com, quoting unnamed sources, said these talks are continuing separately.

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