AOL hires advisers for options, eyes Yahoo

NEW YORK, USA: AOL Inc is exploring strategic options, which include a possible tie-up with Yahoo Inc, and has retained financial advisers to do so, the Wall Street Journal reported on Sunday, citing unnamed sources.

AOL has not reached out to Yahoo with a proposal, the Journal said, adding that the company's advisers have been showing officials different ideas about a potential deal.

These options include merging Yahoo's and AOL's online businesses and spinning off Yahoo's Asian assets to give shareholders back some capital, the paper reported. Another idea would have private equity buy a stake in the combined operations and give a dividend to Yahoo shareholders, the paper said.

AOL is also looking at alternatives other than a deal with Yahoo, the paper reported on its website.

Last month, a source told Reuters that several private equity firms had approached Internet and media companies including News Corp and AOL to gauge their interest in buying out Yahoo Inc.

A potential deal would be contingent on Yahoo selling its prized Asian assets, including a 40 percent stake in China's Alibaba Group and 34.5 percent of Yahoo Japan, the source told Reuters at the time.

AOL wasn't immediately available for comment on Sunday.