It is being reported that private equity firms have approached News Corporation about possibly buying Yahoo. This emerged as shareholders continue to push for a sale of the company to private equity firms with possible involvement from AOL.

The speculation about an imminent sale of Yahoo pushed its shares up by as much as 9.9% last hight before they settled up 4.5 to $15.93. This values the company at $21.5bn — although that value is highly notionally with analysts recently saying that Yahoo! was worth next to nothing.

News Corp with its own struggling digital business has been touted as a possible merger partner for Yahoo along with AOL in an effort to provide a bulwark against Google.

According to sources quoted by the Hollywood Reporter, private equity firms thought to include Silver Lake Partners and Blackstone Group, have approached News Corp with a plan that would call for it to roll some of its digital business (namely MySpace) into Yahoo! in return for a significant stake in the combined company.

MySpace and Yahoo could both do with a fuel injection. The question is what would the two of them add up to?

On the plus side MySpace continues to be very popular in terms of music and entertainment and despite talk of its demise it is doing much better than people often think (MySpace: A reminder. It is still here and doing O.K). That could prove a real plus for Yahoo in helping it find some of the dynamism that seems to be missing from its business.

A deal is still seen as being more likely with AOL. There are more similarities between the two as they both attempt to transforms themselves into content focused businesses.

The report says that the News Corp talks — as those with AOL — are in preliminary stages.

A wild card that could still be thrown into this mix is Microsoft. It has form in the Yahoo context having of course tried before to snare Yahoo before with its failed 2008 bid.

Red more on the future of Yahoo!

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Yahoo! is worth next to nothing – is a merger with AOL in its future?