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Microsoft says Yahoo snub 'unfortunate'

Says time to take fight to Google is now
By John Fontana , NetworkWorld.com , 02/11/2008

Microsoft Monday said it was "unfortunate" that Yahoo turned down its $44.6 billion acquisition offer because time is of the essence to marshal forces against Google.

In the statement released Monday afternoon, Microsoft said the combination of Microsoft and Yahoo would create a more effective force in the marketplaces Google dominates: Internet search and online advertising. (Read the text of Microsoft's statement.)

“The Yahoo response does not change our belief in the strategic and financial merits of our proposal. As we have said previously, Microsoft reserves the right to pursue all necessary steps to ensure that Yahoo’s shareholders are provided with the opportunity to realize the value inherent in our proposal.”

Yahoo said Monday that Microsoft’s “ unsolicited proposal substantially undervalues the company.” 

On Feb. 1, Microsoft made a bid to purchase Yahoo for $44.6 billion, which represented a 62% increase over the Yahoo stock price on that day, which was $19.18. Last week, the offer helped pushed Yahoo stock to $29.20.

Analysts have been speculating that Microsoft may raise its offer by $5 billion to $12 billion. Yahoo is said to be seeking about $40 per share, which would make the offer $56 billion.

Microsoft also could push for a hostile takeover in bypassing Yahoo’s board and going directly to the stockholders, but that avenue presents risks on many fronts including having to oust the entire 10-person Yahoo board.

Rumors also are circulating that Time Warner division AOL could enter the picture and team up with Yahoo, although that union is not judged to be as strong a competitor to Google.

Google itself has also entered the picture offering to help Yahoo avert a takeover and remain an independent company.

Microsoft believes now is the time for it to accelerate its move into search, advertising and services delivery before Google builds an insurmountable lead. Both Microsoft and Yahoo are playing from behind in the search game against Google, whose U.S. internet search market share increased from 51.7% in the fourth quarter of 2006 to 58.4% during the same quarter in 2007, according to comScore. In that same period, Yahoo declined from 27.6% to 22.9%, and Microsoft’s from 10.4% to 9.8%.

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M$ still hates the InternetBy Anonymous on February 14, 2008, 4:38 pmBill missed the Internet entirely (read his book from 1994), then tried to kill it (client/server is still The Way), and now is continuing his attempt to buy it....

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M$ looking for another way to charge for the WebBy M$ user and hater on February 13, 2008, 9:56 amIf you think all the features and links within Yahoo! will remain free once incorporated into M$, you must still believe in the Tooth Fairy. Nothing M$ does is...

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RE: Microsoft says Yahoo snub 'unfortunate'By Dave on February 12, 2008, 10:57 amWhy cant Micro$oft stick at what they are good at, poor operating systems!

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