I hope you are joking. You mean Y! would sell $17 Billion and MSFT would still buy them for the same price?
Yes - I am serious. If I were Yahoo I would be talking to Google about selling search patents and any unnecessary tech they might be interested in. If the tech is not making money then I would burn it, this has already happened with Yahoo Music Service. I doubt there is any of that code left anywhere. Also all internal documentation would either be sold or mysteriously vanish.
The goal for Yahoo is to sell as much as possible to deflect the hostile takeover whilst still leaving them as much as possible to continue business afterwards. Remember this is a hostile takeover.
The scorched-earth defense is a form of risk arbitrage and anti-takeover strategy. When a target firm implements this provision, it will make an effort to make it unattractive to the hostile bidder. For example, a company may agree to liquidate or destroy all valuable assets, also called "crown jewels", or schedule debt repayment to be due immediately following a hostile takeover. In some cases, a scorched-earth defense may develop into an extreme anti-takeover defense called a "suicide pill".