Yahoo has sought to delay any proxy fight by Microsoft for control of the Yahoo board, by extending next week's deadline for nominating directors.
The manoeuvre is designed to buy the search engine more time to find alternatives, as it continues to fight off Microsoft's unwelcome $44 billion (£22 billion) takeover bid.
Meanwhile, the New York Times and Wall Street Journal have reported that Yahoo has stepped up negotiations with Time Warner for a possible tie-up with AOL.
To extend the original 14 March nomination deadline, Yahoo amended its by-laws to state that directors can now be nominated up to 10 days after Yahoo announces the date for its 2008 annual stockholder meeting. (The company has not yet announced the date of that meeting.)
In an email sent to Yahoo employees, CEO Jerry Yang and board chairman Roy Bostock explained that the decision removed an imminent deadline.
"Microsoft, of course, could still choose to name directors," their email said, "but our objective here is to enable our board to continue to explore all of its strategic alternatives for maximising value for stockholders without the distraction of a proxy contest. The email was also filed with the US Securities and Exchange Commission.
Yang and Bostock also acknowledged that Yahoo's board and top managers were exploring alternatives "to create stockholder value" and that they were making progress "clarifying the many options available".
Apparently, Yang began looking for and considering alternatives to a Microsoft acquisition soon after Microsoft announced its bid on 1 February.
In addition to the AOL talks, there have been reports – all attributed to anonymous sources in various media outlets – that Yang has talked to Google, Disney and News Corporation to explore deals that would allow him to reject Microsoft's offer.
The problem for Yang is that an alternative deal would have to at least match the shareholder value of Microsoft's offer. Otherwise, Yahoo would make itself liable to shareholder lawsuits that alleged the board had failed to perform its fiduciary duty.
After Yahoo rejected Microsoft's offer on 11 February, saying it undervalues the company, Microsoft indicated it would be willing to pursue any options to acquire Yahoo, leaving the door open to a hostile takeover through a proxy fight.