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Tidbits of insight into Microsoft - Yahoo failed merger

By Microsoft Subnet on Fri, 06/13/08 - 5:20pm.

This afternoon, news reports are full of tidbits that shed ever more light on the failed Microsoft/Yahoo union. The story  won't be over until August 1 (or beyond), when Carl Icahn is supposed to make his hostile takeover bid. Nevertheless here are some facts from around the Web for those of you following the drama.

Reuters is reporting that Microsoft offered Yahoo $1 billion for its search engine business, "in a deal that would have delivered $1 billion in additional annual operating income to Yahoo, a source familiar with Microsoft's thinking said on Friday. ... Microsoft would have also paid $8 billion to take a 16 percent stake in Yahoo, which would have valued the company's stock at $35 a share, the source said."

Barons is reporting that "Yahoo-Microsoft Deal Still a Possibility" ... to sum up the reasons, financial life for Yahoo as an online advertiser will continue to get tougher.

Wall Street Journal blogger Stephen Grocer reports on word that employees (not to mention stockholders) are not happy that the generous offer from Microsoft has been spurned, and deal that lets uber-competitor Google make money from Yahoo has been struck. The usual Microsoft next-moves are being bandied about, too ... A purchase of Digg or Facebook, or even Social networking is the next frontier for online advertising growth -- so a move in that direction by Microsoft seems likely. Also see: Yahoo-Microsoft deal dead, again, but Yahoo-Google deal in the works

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