Rupert Murdoch's News Corporation is considering swapping MySpace for a stake in Yahoo!

The talks are ongoing, but have been hit by the departure of Terry Semel earlier this week.

According to Murdoch-owned The Times, News Corp will hand over MySpace in exchange for a 25 per cent stake in Yahoo!. The search and portal giant has been accused of lacking direction in recent months but is still worth $37bn.

Murdoch paid $580m for MySpace in 2005, which would be some rate of return.

Yahoo! would benefit from the deal in gaining News Corp's content and a big social networking site - although Facebook has rather overshadowed MySpace in recent months.

It could be the story has more to do with Murdoch's bid to takeover the Dow Jones group. In May he offered $5bn for the group which owns the Wall Street Journal, among other titles.

More from The Times here. ®

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