London (AP) -- Rupert Murdoch's News Corp. is discussing swapping social networking Web site MySpace for a 25 percent stake in Yahoo Inc., The Times newspaper reported Wednesday.
The Times, which is owned by News Corp., said its parent was looking for exposure in a larger Internet-based business such as Yahoo.
News Corp. spent $580 million to buy MySpace in 2005.
A Yahoo spokeswoman declined to comment Wednesday. A News Corp. spokesman did not return a call Wednesday.
Yahoo shares rose 3 cents to $27.66 Wednesday while News Corp.'s stock price fell 8 cents to $23.60.
Based on Wednesday's trading, Yahoo had a market value of about $37 billion. That indicates News Corp. believes MySpace is now worth more than $10 billion, based on a 25 percent stake in Yahoo.
In a research note Wednesday, Standard & Poor's equity analyst Scott Kessler said News Corp.'s asking price as "excessive." He also cited control issues and potential conflicts over Yahoo's online search business as stumbling blocks.
Yahoo has been losing out to Google Inc., whose shares have increased six-fold in value since 2004 while Yahoo's share price has dipped.
Profit at Yahoo fell 11 percent in the first quarter, the company said Monday, and it warned that second-quarter results may be at the low end of expectations.
The downturn has fueled speculation that Yahoo might consider combining with eBay Inc. or MySpace.