Today’s unsubstantiated takeover rumor comes from the Hindustan Times, who reports “US-based Internet giants such as Google and Yahoo are eyeing Rediff.com India Ltd, which runs one of India’s most popular consumer Internet portals”.
Mumbai, India headquartered Rediff.com is a NASDAQ listed company that is a leader in the Indian market, providing news, information, communication, entertainment and shopping services for Indians both in India and worldwide.
The Hindustan Times quotes “investment banking sources” saying that the management of Rediff “was in talks with the global companies for a negotiated takeover deal”.
Rediff share price has risen recently on speculation that the company may be a takeover target.
It’s possible that Rediff could be in talks, but speculation that it’s Google or Yahoo that is looking to acquire Rediff is exactly that: speculation, and with no basis in fact. On recent history, Google and Yahoo are actually unlikely suitors; although Rediff’s market cap and therefore rough takeover price of $738.9million would put it into the realms of a Google buy, recent history, particularly with Google would suggest otherwise. Both Google and Yahoo went gun-ho into China with poor results, and of late Google has chosen to partner with existing players as opposed to buying them. Although India isn’t China, both share a similar demography in terms of growth and of being “foreign” in comparison to traditional Western markets where the Google and Yahoo model has worked well.