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Yahoo Rattles HotJobs Deal With Higher Bid

Yahoo Inc. CEO and chairman Terry Semel was hired in May to make the Web portal less dependent on advertising. He made a big move in that direction last week, tossing in a last-minute bid for job site HotJobs.com that tops the offer made by Monster.com parent TMP Worldwide Inc.
Yahoo Inc. CEO and chairman Terry Semel was hired in May to make the Web portal less dependent on advertising. He made a big move in that direction last week, tossing in a last-minute bid for job site HotJobs.com that tops the offer made by Monster.com parent TMP Worldwide Inc.

The bid from Yahoo (YHOO--Nasdaq) is estimated to be worth $436 million in equal parts cash and stock and is about 6% more than the all-stock deal from TMP, based on TMP's stock price in the middle of last week. But Semel is pitching more than a price premium. He predicts smooth sailing through any Federal Trade Commission review of the deal--something TMP can't promise, because its deal would combine the first-and third-largest job boards. That's drawn complaints from groups such as the American Staffing Organization, which fears the merged company could stifle competition and control prices.

Will TMP sweeten the pot? It will likely have to in order to stay in the running, but Yahoo still has $1.3 billion in cash on hand if a bidding war ensues. It puts HotJobs in a nice position. Says International Data Corp. senior analyst Christopher Boone, "It's a great bargaining chip."