Yahoo out of talks on AOL stake

Internet media firm Yahoo has said it has pulled out of talks to buy a stake in Time Warner's internet unit AOL.

The move came after Yahoo chief executive Terry Semel met Time Warner executives in October, Yahoo said.

"After we learned what their proposed deal terms were we passed and we've never looked back," a Yahoo spokeswoman told the Reuters news agency.

The withdrawal of Yahoo leaves Google and Microsoft as the two favourites to do a deal with AOL.

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