Microsoft Corp. met with Yahoo Inc. to discuss the software maker's unsolicited takeover bid earlier this week, a breakthrough that could be the first step toward a friendly deal between the two rivals.

The meeting occurred Monday near Yahoo's Sunnyvale headquarters, according to a person familiar with the situation. The person spoke Friday on the condition of not being identified because the preliminary talks haven't been formally disclosed.

No investments bankers attended Monday's meeting, nor was there any discussion about whether Microsoft is willing to raise its offer, initially valued at $44.6 billion, or $31 per share. Yahoo's board already has rejected that bid, arguing the company's Internet franchise is worth more.

Although it's unclear whether Microsoft Chief Executive Steve Ballmer and his Yahoo counterpart, Jerry Yang, attended Monday's meeting, senior management from both companies were on hand.

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