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Yahoo! (YHOO) seems to have several options to revive its moribund business, but the market is not buying them based on the portal company’s share price. The stock trades just above $15, not far from its 52-week low.

Investors no longer believe that a partnership based on Google (GOOG) selling search advertising for Yahoo! will make it to the starting line. The US government, the EU, and officials in Canada are all giving the deal a monopoly litmus test. Google has very little incentive to push the deal if it faces legal or political challenges. It was only willing to go forward to kick sand in Microsoft’s (MSFT) face.

Yahoo! board member and shareholder Carl Icahn must be enraged. He hoped to dump Yahoo! on Redmond, but Microsoft seems to have lost interest. The world’s largest software company has looked at the complexity of integrating the two companies along with Yahoo!’s falling share of the US search market and decided there is very little value in an acquisition. Microsoft is giving the $40 billion it would have spent on Yahoo! back to its own shareholders in a stock buyback. That makes everyone happy and avoids the embarrassment of a flawed transaction.

Yahoo! could sell its overseas holdings which include Yahoo! Japan and China e-commerce business Alibaba. It is not entirely clear what these are worth. When Alibaba shares peaked, the figure was probably $10 billion. Now it may be half that, signaling another lost opportunity which can be attributed to Yahoo! management and its board.

The last Yahoo! self-help program which is kicked around with growing frequency is that Yahoo! might buy AOL from Time Warner (TWX). The theory is that large media firm would take equity in Yahoo!, perhaps owning a third of the company. Why Time Warner would do that is a mystery. It would own a stake in Yahoo! which it could never sell without driving the portal’s share price toward zero. Having a strategic partner dumping shares does that.

Investors turned on the Yahoo! management and board with a special viciousness when the Microsoft deal fell apart. Now, it is obvious that Yahoo! has no good options. Yahoo! executives are hiding in their offices aware that the next stage of the witch hunt is beginning. The fire has already been set

Douglas A. McIntyre