Yahoo admits to delays in its deal with Microsoft

YAHOO HAS ADMITTED that its search deal with Microsoft has been delayed while the companies iron out a number of undisclosed details.

The two firms signed a deal in July, in which Microsoft's Bling, er, Bing search engine will drive Yahoo search, while Yahoo will flog search and website advertising for both companies.

The two firms said at the time that they expected to agree on final terms by 27 October, but a Yahoo filing with the US Securities and Exchange Commission shows that this has not happened.

"Given the complex nature of the transaction, there remain some details to be finalised," Yahoo said in the filing. "The parties are working diligently on finalising the agreements, have made good progress to date, and have agreed to execute the agreements as expeditiously as possible."

Observers have suggested that the reason for the delay probably stems from the extensive terms of the agreement and the 10-year commitments involved for both companies.

Once Microsoft and Yahoo have obtained regulatory approval for the deal in the US, they will then have to gain approval from European regulators as well.

This could take some time, considering the how long it is taking European authorities to approve Oracle's proposed acquisition of Sun Microsystems.

Yahoo said in a statement, "Given the complex nature of this transaction there remain some issues that need some additional clarity and definitive details. Both companies are optimistic that we will be able to close this deal by early 2010."

Microsoft did not immediately respond to a request for comment. µ