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Is the Yahoo deal done yet? The stock market thinks so, slicing Yahoo’s financial value by 15% in the last two trading sessions. If the deal were still alive, then the stock would be moving the other way around. Yahoo’s chief Jerry Yang says the $37-per-share demand wasn’t etched in stone but he’s sporting a good dose of Wall Stree’s most lethal cologne – desperation - for anyone to take him too seriously today. Still, I think he wants Steve Ballmer to come back to the table and do the deal.

But Ballmer and Microsoft seem to want to move on. Traders are still buzzing about how fast Ballmer got up and moved away from the negotiation table – going from very enthusiastic to unusually tepid in the space of a few weeks. The big reasons for Ballmer’s change of heart? First, Microsofot’s employees uniformly came out against the Yahoo deal. That whole “synergy” thing didn’t go over well inside Fortress Microsoft. Maybe Microsoft staffers took their cue from Yahoo management, which considered a future with Microsoft with the all the passion and fervor of a maitre’d ordering at the drive-through window of a Burger King.

So maybe Microsoft employees are on to something. Maybe there is a better and cheaper way to create that symmetry that Bill Gates and Steve Ballmer like so much, and that has paid off so handsomely to investors over the years.

Sramana Mitra, writing in the May 6 edition of SeekingAlpha, agrees, saying that Microsoft should put Yahoo behind it and leave its shareholder-value phobic CEO Jerry Yang to explain why he doesn’t want Yahoo investors to make any money. Instead, Microsoft should focus on a few, carefully-selected, nimble purchases of technology firms that can do as much for Microsoft – or more – than Yahoo ever could.

Here’s a list, with a brief description from Mitra on what the company would bring to Microsoft’s dinner table:

Kayak: Microsoft acquired online travel search engine Farecast earlier, indicating that it is already thinking about an alternate strategy.

Valuation: $700-$800 Million.

Strategy: Continue to build out a vertical presence in online travel, and acquire a few more companies for a total budget of $1.5 billion.

Trulia: Real Estate search engine Trulia can be a good trunk to build Microsoft a strong presence in the Real Estate vertical.

Valuation: $100-150 Million.

Strategy: Acquire another 3-4 vertical portals in Real Estate with a total budget of $1 billion, including a couple of public companies like ZipRealty (ZIPR).

SimplyHired, LinkedIn and eLance: Microsoft should also develop a strong presence in Jobs by acquiring LinkedIn (Valuation: $700-$800 million), eLance (Valuation: $200-$250 million), and SimplyHired.

Strategy: Create a strong foothold in the massive Jobs vertical. Budget: $1.5 billion.

Shutterfly (SFLY): Strong, independent, public company in the online photo space with a strong management team. Extremely cheap market price of $325 million, with good strategy.

eHarmoney: Offers a strong foothold in online personals. Valuation: $1 - $1.2 billion.

Altogether, Sitra says the price of all these deals combined would only set Microsoft back by $6 billion - or about seven or eight percent of the $45 billion Ballmer offered Yang for Yahoo.

Food for thought while Jerry Yang ponders the future of his company - maybe even in the drive-through lane of a Burger King.

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