JOIN USSilver Lake Partners and Blackstone Group LP are among the firms that have expressed interest in teaming up with AOL to buy Yahoo, or take it private on their own, said The Wall Street Journal quoting people familiar with the matter.
"At least two or three other firms could be interested in participating if a formal buyout proposal is drawn up," the report said.
It added that the discussions involving private equity firms, AOL executives and financial advisers are preliminary and do not yet involve Yahoo.
"The conversations may not lead to an approach given the complexities in structuring a proposal," the report quoted the people as saying.
The Journal said that one of the scenarios being discussed is a "complex deal" in which China's Alibaba Group would buy back Yahoo's nearly 40 per cent stake in Alibaba.
Some of Yahoo's other assets would also be sold off to interested media or technology companies.
A second scenario involves AOL combining its operations with Yahoo in a "reverse merger" after Yahoo disposes of the Alibaba stake.
Alibaba Chief Executive Jack Ma has expressed interest in repurchasing Yahoo's stake in his company, which is valued at about $10 billion.
The Journal said AOL Chief Executive Tim Armstrong too has talked about the idea that Yahoo could buy AOL.
Private-equity firms may also look to partner with media companies to buy Yahoo.
"A combined Yahoo-AOL would have greater scale to compete in online advertising against industry juggernaut Google Inc. While both companies draw huge amounts of users, their advertising businesses have struggled as they have faced competition from a range of websites," the report said.
Yahoo and AOL had discussed a merger in 2008, when Yahoo weighed a 45 billion dollars takeover offer from Microsoft.
In recent weeks as several senior Yahoo employees left the company, Yahoo Chief Executive Carol Bartz has faced increasing pressure to prove she can reverse the company's fortunes.
Earlier this month, Yahoo's Executive Vice President of the Americas region Hilary Schneider, Senior Vice President David Ko and Vice President of Media Jimmy Pitrao quit the company.