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There's no chance the Gov would allow them to merge. They're just doing it to drive up the price for Microsoft.

Steve Ballmer said he thought MS were "lucky" that they hadn't bought Yahoo. I don't think he will think of going near it. Unless there is real chance of Google buying them, but I don't see that happening even if Google wants Yahoo, as the regulators will go berserk at that.

It's not - FTC won't allow it. Maybe they're saying this to drive up the bidding price?

I must have missed this. When did Google get slapped with an anti-trust investigation?

The current one is over favoring there own products in search results over third parties. Some of the evidence is pretty damning, I was quite surprised at the what they had put together.

In general its over enhancements such as searching for a company and the first result is a Google map location with a nice thumb nail and a link through to the google review site as opposed to the actual business.