In a moved to fight off a hostile takeover bid from Microsoft Corp., Internet portal Yahoo, Inc. and social networking site MySpace could wind up as part of the same company if high level corporate talks come to bear fruit, according to reports.

Executives at MySpace parent company News Corp. are holding discussions to combine the site and other Internet properties in exchange for more than 20 percent ownership of Yahoo, according to the Wall Street Journal.

The development was initially mentioned on industry blog Silicon Alley Insider, followed TechCrunch. The deal could include cash from News Corp and an unnamed private equity fund, according to Tech Crunch.

Previous attempts over the past 18 months to strike a deal have fallen apart because Yahoo and News Corp could not agree on the valuation of MySpace, which has ranged between $6 billion and $10 billion, the Journal reported.

Microsoft recently made an unsolicited $45 billion bid for Yahoo as it attempts to strengthen itself against Internet search leader Google. Yahoo's Board of Directors rejected the offer saying that the software maker had massively undervalued the company.

Microsoft has said the rejection was unfortunate and is pursuing other options, which could include taking its offer to shareholders directly.

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